Internal Revenue Bulletin: 2004-31
August 2, 2004
Table of Contents
Annuity payments. This ruling addresses the taxation of income received by residents of Puerto Rico and nonresident aliens under life insurance and annuity contracts issued by a foreign branch of a U.S. life insurance company. The ruling holds that income received by nonresident aliens under life insurance and annuity contracts issued by a foreign branch of a U.S. life insurance company is U.S.-source FDAP income. The ruling also holds that income received by bona fide residents of Puerto Rico under life insurance or annuity contracts issued by a Puerto Rican branch of a U.S. life insurance company is U.S.-source income.
Dual resident company. This ruling concludes that a dual resident company, resident in both Country Y and Country X under the domestic laws of those countries, is not entitled to claim benefits under the U.S. income tax convention with Country X if it is treated as a resident of Country Y and not of Country X for purposes of the income tax convention between Country X and Country Y and, as a result, is not liable to tax in Country X by reason of its residence. Rev. Rul. 73-354 obsoleted.
Corporate reorganizations; exchange of debt instruments. This ruling discusses the exchange of a debt security for a debt instrument in a reorganization.
Corporate distributions of property. This ruling addresses the tax consequences of the distribution by a subsidiary to its parent of parent indebtedness that the subsidiary previously purchased from a party unrelated to the parent.
This procedure provides alternative disclosure procedures that are deemed to satisfy a taxpayer’s disclosure obligations under section 1.6011-4 of the regulations for transactions with a significant book-tax difference under section 1.6011-4(b)(6). Taxpayers also may continue to follow the disclosure procedures provided in section 1.6011-4 for disclosing transactions described in section 1.6011-4(b)(6).
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