There is no significant trading of USRPI
through offshore transactions, so there is no readily available opportunity for tax avoidance by using them.
897(g) to clarify how to determine what is attributable to a USRPI
when a partnership owns both USRPIs
real property holding corporation, the term USRPI
means an interest, other than an interest solely as a creditor, in a foreign corporation unless it is established that the foreign corporation is not a U.
Under this provision, any gain recognized by a foreign person on the disposition of a USRPI
will be treated as if such gain were ECI and, therefore, subject to U.
1445 (a) imposes a 10% withholding tax on the gross amount realized on a disposition of a USRPI
by a foreign person.
Upon disposition of USRPI
, the withholding tax does not excuse the foreign investor to file U.
3) As stated above, [section] 897 treats any gain recognized by a foreign person on the disposition of a USRPI
as if it were effectively connected to a U.
897, which treats gain or loss from the disposition of a USRPI
as effectively connected gain or loss, does not change the capital asset character of the USRPI
Given that the investor's long position in the swap is equivalent economically to a leveraged purchase of the underlying stock in the USRPHC, the issue arises whether Code [section] 897 applies to the investor when such position is disposed of 2 The IRS could assert two alternative arguments in attempting to apply Code [section] 897 to the investor's long position in the swap 1) the investor's position in the swap is itself a USRPI
, or 2) that the investor should be treated as owning the underlying USRPHC stock under common law principles.
as the result of a repossession of or foreclosure on the property need to be aware of their Sec.
The partnership and the domestic corporation would not be obligated to adhere to the reporting requirements that ordinarily are required to establish that an interest in a domestic corporation is not a USRPI
not just USRPHCs or former USRPHCs) by requiring the corporation to withhold if the foreign person's interest in the corporation constitutes a USRPI