Treasury Regulations (26 C.F.R.)
26 CFR § 1.267A-1
Disallowance of certain interest and royalty deductions.
# (a) Scope.
This section and §§ 1.267A-2 through 1.267A-5 provide rules regarding when a deduction for any interest or royalty paid or accrued is disallowed under section 267A. Section 1.267A-2 describes hybrid and branch arrangements. Section 1.267A-3 provides rules for determining income inclusions and provides that certain amounts are not amounts for which a deduction is disallowed. Section 1.267A-4 provides an imported mismatch rule. Section 1.267A-5 sets forth definitions and special rules that apply for purposes of section 267A. Section 1.267A-6 illustrates the application of section 267A through examples. Section 1.267A-7 provides applicability dates.
# (b) Disallowance of deduction.
This paragraph (b) sets forth the exclusive circumstances in which a deduction is disallowed under section 267A. Except as provided in paragraph (c) of this section, a specified party's deduction for any interest or royalty paid or accrued (the amount paid or accrued with respect to the specified party, a specified payment) is disallowed under section 267A to the extent that the specified payment is described in this paragraph (b). See also § 1.267A-5(b)(5) (treating structured payments as interest paid or accrued for purposes of section 267A and the regulations in this part under section 267A). A specified payment is described in this paragraph (b) to the extent that it is—
(1) A disqualified hybrid amount, as described in § 1.267A-2 (hybrid and branch arrangements);
(2) A disqualified imported mismatch amount, as described in § 1.267A-4 (payments offset by a hybrid deduction); or
(3) A specified payment for which the requirements of the anti-avoidance rule of § 1.267A-5(b)(6) are satisfied.
# (c) De minimis exception.
Paragraph (b) of this section does not apply to a specified party for a taxable year in which the sum of the specified party's specified payments that but for this paragraph (c) would be described in paragraph (b) of this section is less than $50,000. For purposes of this paragraph (c), specified parties that are related (within the meaning of § 1.267A-5(a)(14)) are treated as a single specified party.
[T.D. 9896, 85 FR 19836, Apr. 8, 2020]
Source: view the official text
In this part (40 sections)
- 1.263A-4 · Rules for property produced in a farming business.
- 1.263A-5 · Exception for qualified creative expenses incurred by…
- 1.263A-6 · Rules for foreign persons. [Reserved]
- 1.263A-7 · Changing a method of accounting under section 263A.
- 1.263A-8 · Requirement to capitalize interest.
- 1.263A-9 · The avoided cost method.
- 1.263A-10 · Unit of property.
- 1.263A-11 · Accumulated production expenditures.
- 1.263A-12 · Production period.
- 1.263A-13 · Oil and gas activities.
- 1.263A-14 · Rules for related persons.
- 1.263A-15 · Effective dates, transitional rules, and anti-abuse rule.
- 1.264-1 · Premiums on life insurance taken out in a trade or business.
- 1.264-2 · Single premium life insurance, endowment, or annuity…
- 1.264-3 · Effective date; taxable years ending after March 1, 1954,…
- 1.264-4 · Other life insurance, endowment, or annuity contracts.
- 1.265-1 · Expenses relating to tax-exempt income.
- 1.265-2 · Interest relating to tax exempt income.
- 1.265-3 · Nondeductibility of interest relating to exempt-interest…
- 1.266-1 · Taxes and carrying charges chargeable to capital account and…
- 1.267A-1 · Disallowance of certain interest and royalty deductions.
- 1.267A-2 · Hybrid and branch arrangements.
- 1.267A-3 · Income inclusions and amounts not treated as disqualified…
- 1.267A-4 · Disqualified imported mismatch amounts.
- 1.267A-5 · Definitions and special rules.
- 1.267A-6 · Examples.
- 1.267A-7 · Applicability dates.
- 1.267(a)-1 · (a)-1 Deductions disallowed.
- 1.267(a)-2T · (a)-2T Temporary regulations; questions and answers…
- 1.267(a)-3 · (a)-3 Deduction of amounts owed to related foreign persons.
- 1.267(b)-1 · (b)-1 Relationships.
- 1.267(c)-1 · (c)-1 Constructive ownership of stock.
- 1.267(d)-1 · (d)-1 Amount of gain where loss previously disallowed.
- 1.267(d)-2 · (d)-2 Effective/applicability dates.
- 1.267(f)-1 · (f)-1 Controlled groups.
- 1.268-1 · Items attributable to an unharvested crop sold with the land.
- 1.269-1 · Meaning and use of terms.
- 1.269-2 · Purpose and scope of section 269.
- 1.269-3 · Instances in which section 269(a) disallows a deduction,…
- 1.269-4 · Power of district director to allocate deduction, credit, or…