Final Regulations Require Reporting by Foreign Owned Domestic Disregarded Entities

         The IRS has issued final regulations that treat a domestic disregarded entity wholly owned by a foreign person as a domestic corporation separate from its owners, but only for the reporting, record maintenance, and associated compliance requirements that apply to 25% foreign owned domestic corporations. These changes are intended to provide the IRS with improved access to information that it needs to satisfy its obligations under U.S. tax treaties, tax information exchange agreements and similar international agreements, as well as to strengthen the enforcement of U.S. tax laws.