Internal Revenue Bulletin: 2011-31
August 1, 2011
Final regulations under section 956 of the Code contain guidance regarding the determination of basis in certain U.S. property acquired by a controlled foreign corporation in certain nonrecognition transactions. The Service and the Treasury Department became aware that certain taxpayers were engaging in certain nonrecognition transactions that were intended to repatriate earnings and profits of a controlled foreign corporation without U.S. income taxation. These regulations finalize guidance intended to end such abuses.
2011 section 43 inflation adjustment factor. This notice announces the inflation adjustment factor and phase-out amount for the enhanced oil recovery credit for taxable years beginning in the 2011 calendar year. The notice concludes that, because the reference price for the 2010 calendar year ($74.71) exceeds $28 multiplied by the inflation adjustment factor for the 2010 calendar year ($42.91) by $31.80, the enhanced oil recovery credit for qualified costs paid or incurred in 2011 is phased out completely. The notice also contains the previously published figures for taxable years beginning in the 1991 through 2010 calendar years.
2011 marginal production rates. This notice announces that under section 613A(c)(6)(C) of the Code, the applicable percentage for purposes of determining percentage depletion on marginal properties for calendar year 2011 is 15 percent.
This notice provides for the suspension of certain requirements under section 42 of the Code for low-income housing credit projects in North Dakota in order to provide emergency housing relief needed as a result of the devastation caused by flooding in North Dakota beginning on February 14, 2011.
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