IRS proposes required taxpayer disclosure of uncertain tax positions
A new proposal to require certain business taxpayers to disclose uncertain tax positions at the time they file their returns has been announced by the IRS. Taxpayers will not be required to disclose their risk assessment or tax reserve amounts but the IRS notes that it can compel production of that information via summons. A new schedule for use by business taxpayers with assets over $10 million is in under development, meaning that this proposal has a direct impact on foreign private issuers and companies with US subsidiaries.
On this page you can access a range of materials from Ernst & Young. Be sure to check back regularly on this developing issue.
Schedule UTP Considerations for Non-U.S. Corporations Doing Business in the United States
Non-U.S. corporations doing business in the United States through a U.S. branch or subsidiary corporation ("inbound corporations") should be aware of a new U.S. tax requirement that under certain circumstances will require disclosure on the U.S. tax return of U.S. tax positions that are treated as "uncertain" in audited financial statements (AFS). Read more in this detailed tax alert.
Replay the webcast: What your company needs to know about disclosing its uncertain tax positions on final Schedule UTP
The 24 September release of the 2010 Schedule UTP and its instructions has made disclosing uncertain tax positions a reality for companies with assets of $100 million or more. For insight into the challenges companies now face, replay our 90-minute webcast which was originally broadcast on 4 October 2010.
Final schedule UTP published: applies to corporations with assets of $100 million or more for 2010, replaces MTA with ranking and modifies concise description requirement
In his key note address before the American Bar Association in Toronto on September 24, 2010, IRS Commissioner Douglas Shulman announced the much-anticipated release of the final schedule (Schedule UTP) and instructions for disclosing uncertain tax positions, as initially outlined in Announcement 2010-9. Final Schedule UTP differs from the draft schedule in several respects. The final schedule sees a phase-in approach, meaning that it will apply corporations with assets of $100 million or more for 2010. The final schedule also replaces MTA with ranking and modifies the concise description requirement. read more in this detailed tax alert.
Ernst & Young files comment letter on UTP proposal
Ernst & Young has submitted comments in response to IRS Announcements 2010-9, 2010-17, 2010-30, and the proposed form and instructions for disclosure of uncertain tax positions. Our comments acknowledge the fundamental impact this proposal will have on tax return examinations and suggest a number of changes to the proposed requirements, including delaying implementation to allow for further development of the reporting requirements.
Webcast archive now available: IRS releases schedule for disclosure of uncertain tax positions: what you need to know
On 19 April, the Internal Revenue Service (IRS) released Announcement 2010-30, which includes a draft schedule to implement the principles originally set forth in Announcement 2010-9, along with draft instructions. The release of these drafts is intended to clarify some of the issues that have been brought to the IRS's attention in recent weeks. April 28 saw the authors of the draft schedule and instructions join a panel of Ernst & Young LLP professionals for a detailed webcast discussion of the requirements. An archive of the webcast is now available and can be accessed here.
Uncertain tax positions: draft schedule and instructions now available
The IRS has released its highly anticipated draft schedule (Schedule UTP ) and instructions for disclosing uncertain tax positions (UTPs), as initially outlined in Announcement 2010-9. While limiting the disclosure requirement to certain corporate filers for 2010, the draft instructions still require corporations to provide the controversial concise description and maximum tax adjustment (MTA) for each tax position disclosed on Schedule UTP. Read more in this Ernst & Young tax alert.
Searching for clarity in Uncertain Tax Positions: financial reporting perspectives
An Ernst & Young thought leadership paper spotlighting uncertain tax positions (UTPs) under IFRS (pdf, 684kb) is now available. It provides insights into the diversity of practices that have developed in the financial reporting and disclosure of UTPs, given the lack of direct guidance IAS 12 (Income Taxes) has in this area. It also discusses potential future developments and standard-setter activity around this hot topic, and leading practices companies may consider.
Tax Policy and Controversy Briefing: an interview with Ernst & Young's Rob Hanson
Implications of the recent IRS proposals on uncertain tax positions reach beyond tax and into the boardroom for companies around the world. In this interview with Rob Hanson, (pdf, 1.38mb) Ernst & Young's leader of Tax Controversy and Risk Management Services in the Americas, we discuss the proposals, their background and what they might mean for companies inside and outside the United States.
Thought Center Webcast 22 February: IRS Announcement 2010-9 uncertain tax positions - policy of restraint: what you need to know
On February 22nd, Heather Maloy, IRS Commissioner, Large and Mid-Size Business Division, joins Ernst & Young LLP professionals to discuss the new IRS proposals around Uncertain Tax Positions and possible implications. Our panel of Ernst & Young LLP professionals for an overview of the proposed requirement and a discussion of the possible implications for taxpayers, external auditors and return preparers, and the IRS. Learn more about the background behind the proposal, its implications for you and your company, questions that are being raised and what actions you can take now.
Tax alert: IRS proposes required taxpayer disclosure of uncertain tax positions
The Service has announced a proposal to require certain business taxpayers to disclose uncertain tax positions at the time they file their returns. Unofficial comments subsequent to the issuance of the announcement indicate that any such new requirement would not be effective for tax year 2009 returns. Read more in this January 28 tax alert
IRS proposals on Uncertain Tax Positions – a Canadian perspective
While the recent IRS reporting proposals focus on US federal tax, it will nonetheless have a significant and predictable domino effect in Canada. Canadian entities should be aware of the range of potential consequences (pdf, 78.42kb) which we outline in our recent tax alert.