USA, McDermott Will & Emery updates

Corporate Tax

Contributed by McDermott Will & Emery
Exxon prevails in $200 million tax penalty case
  • USA
  • 19 February 2021

The US District Court for the Northern District of Texas recently ruled in favour of Exxon Mobil Corporation in its battle against the government over tax penalties. Exxon had filed amended returns for its 2006 to 2009 tax years seeking a $1.35 billion tax refund based on a change of character of certain transactions. The government disallowed the refund claims and imposed a $200 million penalty pursuant to Section 6676 of the Internal Revenue Code. Exxon paid the penalty and filed suit for a refund.

New Jersey reconsiders financial transaction tax
  • USA
  • 25 September 2020

A troubling New Jersey financial transaction tax proposal, which appeared to be gaining popularity over the past few months, has reportedly been left out of the 2021 budget deal that Governor Phil Murphy recently struck with legislative leaders. The decision to drop the transaction tax from the deal came days after the Wall Street Journal reported that prominent stock exchanges with data centres in New Jersey were prepared to exit the state if the tax plan was adopted.

IRS issues proposed regulations intended to clarify carried interest rules
  • USA
  • 04 September 2020

The Internal Revenue Service recently issued proposed regulations under Section 1061, a provision enacted as part of the Tax Cuts and Jobs Act 2017 that recharacterises certain net long-term capital gain with respect to applicable partnership interests as short-term capital gain. The proposed regulations provide clarity on some of the statutory provisions. This article discusses some of the noteworthy provisions in the proposed regulations.

Section 965 statutes of limitations for partnerships
  • USA
  • 03 July 2020

The Internal Revenue Service (IRS) recently issued guidance on the period of limitations for Section 965 of the Internal Revenue Code transition tax-related adjustments of partnerships. Typically, pursuant to Section 6501, the IRS has three years to assess a tax liability for a tax year. However, Section 6501(e)(1)(C) states that if the taxpayer omits from gross income an amount properly includible in income under Section 951(a), the tax may be assessed at any time within six years after the return was filed.

California bill would make taxpayer information available to public
  • USA
  • 19 June 2020

A concerning bill is pending in the California Senate which would require the California state controller's office to make taxpayer information publicly available. The bill would require that the controller post on its website a list of all taxpayers subject to the California corporation tax with gross receipts of $5 billion or more and information about each taxpayer, including tax liability and the amount of tax credits claimed in the previous calendar year.

Employment & Immigration

Contributed by McDermott Will & Emery
COVID-19 vaccine FAQs for employers
  • USA
  • 13 January 2021

Employers can implement a mandatory COVID-19 vaccination policy, subject to some conditions and exceptions. There are a number of factors that employers should consider when determining whether to make a COVID-19 vaccine mandatory or voluntary, including the administrative burden, legal exposure and public relations issues. This article answers employers' key questions on the matter.

Cal/OSHA adopts emergency COVID-19 workplace standards
  • USA
  • 09 December 2020

California's Division of Occupational Safety and Health (Cal/OSHA) recently adopted emergency temporary standards on COVID-19 prevention in the workforce. These temporary standards will require most Californian employers to implement a written COVID-19 prevention programme meeting certain criteria. While many employers have already followed Cal/OSHA guidance to minimise employees' exposure to COVID-19, the new requirements warrant an immediate review of current policies to ensure compliance.

Executive order on workplace training for federal contractors and federal grant recipients released
  • USA
  • 04 November 2020

President Donald Trump recently issued an executive order which prohibits federal contractors and federal grant recipients from conducting any workplace training that implies, among other things, reverse discrimination. This requirement applies to all contracts and grants entered into after the order's effective date and takes effect 60 days after the order's effective date, potentially affecting many organisations that currently receive federal assistance through contracts, grants or other programmes.

Considerations for remote and in-person workers as school year commences
  • USA
  • 14 October 2020

As students begin a new school year, employers face a new challenge – employee leave and accommodation requests. With widespread remote learning and evolving legal obligations to provide paid leave to working parents, employers must navigate unique staffing challenges while complying with the Families First Coronavirus Response Act and other state and local leave laws.

New California law: notice of COVID-19 exposure in workplace and imminent hazards in worksites
  • USA
  • 07 October 2020

California Governor Gavin Newsom has signed Assembly Bill 685 into law, which will come into effect on 1 January 2021. The law creates an enforceable state-wide standard for how employers should handle potential exposure to COVID-19 and outbreaks in the workplace and expands the power of California's Division of Occupational Safety and Health to enforce this standard and take action to protect employees, including shutting down worksites deemed to be an 'imminent hazard' due to COVID-19 risk.

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