Final regs. issued requiring uncertain tax position disclosure statement.

• Author: Nevius, Alistair M.

On December 13, the IRS issued final regulations requiring some corporations to file a Schedule UTP, Uncertain Tax Position Statement, disclosing their uncertain tax positions when filing a return (T.D. 9510). The final regulations adopt regulations proposed in September 2010 (REG-119046-10), with one change relating to the effective date.

In January 2010, the IRS announced that it planned to start requiring certain corporate taxpayers to disclose uncertain tax positions annually in their federal income tax returns. For the 2010 tax year, corporations filing Form 1120, U.S. Corporation Income Tax Return, insurance companies filing Form 1120-L, U.S. Life Insurance Company Income Tax Return, or 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return, and foreign corporations filing Form 1120-F, U.S. Income Tax Return of a Foreign Corporation, must disclose their uncertain tax positions on Schedule UTP when the company or a related party issues audited financial statements and the company has both (1) one or more uncertain tax positions that must be reported on Schedule UTP (as defined by the IRS in the instructions for Schedule UTP) and (2) total assets equal to or in excess of $100 million. The total asset threshold will be reduced to $50 million in 2012 tax years and to $10 million starting with 2014 tax years. The IRS is considering whether to extend UTP reporting to other taxpayers beyond those noted above for 2011 or later years.

One commentator, concerned that Schedule UTP would require disclosure of privileged information, had requested that the regulations should...