TaxConnections

Ask Tax Question

What is a dual consolidated loss?

Consolidated Tax Domestic & International Tax Planning International Tax
TaxConnections Members... Answer This Question Want To be One of Our Tax Experts? Register Here

Tax Professional Answers

User Photo
Douglas Stransky
In general, Treas. Reg. § 1.1503-2(b)(1) provides that a “dual consolidated loss” of a “dual resident corporation” cannot offset the taxable income of any domestic affiliate in the taxable year in which such loss was recognized or in any other tax year. Pursuant to Treas. Reg. §§ 1.1503-2(c)(1) and (2), the same limitation applies to a dual consolidated loss of a “separate unit” of a domestic corporation as if the “separate unit” were a wholly owned subsidiary of such corporation.

Pursuant to Treas. Reg. § 1.1503-2(c)(4), the term “separate unit” includes a “hybrid entity separate unit,” i.e., an interest in an entity that was not taxable as an association for U.S. federal income tax purposes but is subject to income tax in a foreign country as a corporation (or otherwise at the entity level) either on its worldwide income or on a residence basis.

Treas. Reg. § 1.1503-2(c)(5)(i) provides that the term “dual consolidated loss” means the net operating loss (as defined in IRC § 172(c) and the regulations thereunder) of a domestic corporation incurred in a year in which the corporation is a dual resident corporation.
Leave a Comment 287 weeks ago



Meet Leading Tax Advisors

User Photo John Stancil

Lakeland, Florida, USA

Tax Advisor/CEO

User Photo Peter J. Scalise

New York, New York, USA

Federal Tax Credits & Incentives Practice Leader

User Photo John Dundon, II EA

Denver, Colorado, USA

Tax Director

 

View/Select our Current List of Tax Topics

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Previous PageNext Page

INCREASE KNOWLEDGE WITH EVERY ISSUE OF TAXCONNECTIONS

 

Learn from tax advisors, straight to your inbox

Update My Email Address
Contact Us Today