Bank holding companies face October 31 deadline for revising tax allocation agreements
Posted On: 9-5-2014 | Posted By: WK Staff
Recent regulations issued by federal agencies require banks and bank holding companies to amend their tax allocation agreements to clarify the agency relationship and affirm the bank’s ownership rights in tax refunds. Review and revision of the tax allocation agreements must be complete by October 31, 2014.
The FDIC, Federal Reserve and Department of the Treasury jointly issued the final addendum to the Interagency Policy Statement on Income Tax Allocation in a Holding Company Structure. The regulations cite bankruptcy disputes between failed insured depository institutions (IDIs) and their holding companies regarding ownership of tax refunds generated by the banks as the reason for the addendum. To allow holding companies to pay taxes on a consolidated basis but protect banks’ ownership rights of refunds, the agencies recommend that tax allocation agreements be amended.
View a printer-friendly PDF of Tax allocation agreements.
To learn more about these regulations and discuss how WK can assist you in reviewing and revising the tax allocation agreements, contact Troy Norton, CPA/ABV at (573) 442-6171 or firstname.lastname@example.org.