Reed Smith News Flashes

This morning, the U.S. Supreme Court agreed to hear a taxpayer’s challenge to the federal transition tax enacted with 2017 federal tax reform.1 What happens if the Court finds the transition tax unconstitutional? And what should you do now to protect your rights to a refund?

Taxpayers whose transition tax inclusion year is open in any state they paid tax on deemed repatriated income should consider filing refund claims. But all taxpayers—even those with closed transition tax inclusion years—should consider filing state refund claims if wholly deducting deemed repatriated income increases tax attributes carried into open years.

We discussed these issues and more in our 2021 webinar. Skip ahead to:

  • What are the Moores arguing? – 1:57
  • What are the potential federal tax implications? – 5:34
  • Should you file state tax refunds? – 14:42
  • How can you reduce the deemed repatriation state liability in 21 states? – 16:15
  • How can you reduce your state tax on actual cash repatriation? – 52:20
  • How can you restore state NOLs diminished by the transition tax? – 56:20

  1. Moore v. United States, No. 22-800.

Newsflash 2023-144