PwC's International Tax Services Global Leader Doug McHoney and ITS Partner Rebecca Lee discuss the history and challenges of Section 987 regulations on foreign exchange gains/losses for foreign branches. They analyze the 250-page package of the proposed regulations, its limitations, and its impact on industries like banking and insurance. The hosts also explain the implications for deferred tax assets, liabilities, and pillar two global minimum tax calculations.

Rebecca Lee, an International Tax Principal at PwC specializing in financial transactions and digital assets, joins Doug McHoney for a deep dive into the final and proposed regulations under Section 987. They explore methods for calculating foreign currency gains and losses for qualified business units, major changes in regulations, and implications for partnerships. The conversation also highlights the historic context and discusses the significance of compliance amidst upcoming 2024 changes, stressing the need for taxpayers to stay informed and proactive.