In what is becoming a popular refrain, we are continuing to hear tough talk by government officials on cracking down on offshore activity. The most recent target is once again corporate inversions. In simplest terms, a corporate inversion is where a U.S. corporation is “acquired” by a foreign company so that it can move its headquarters outside of the U.S., thereby reducing its U.S. tax liability.
Yesterday, a tax specialist with the U.S. Treasury stated that the anti-inversion regulations are a priority and could be released as early as this year. Clearly, cracking down on inversions and targeting offshore activity continues to be a high priority for the current administration.