To Defer or Not to Defer
Posted by admin Oct 15, 2012 6:07:20 PM
The Regulated Investment Company (“RIC”) Modernization Act of 2010 (the “Act” or “RIC Mod”) brought an array of changes beneficial to RICs. Certain of these changes allow RICs more flexibility in electing whether or not to defer or to recognize in the current taxable year certain “late year losses.” Late year losses is a new term introduced into tax parlance by RIC Mod which encompasses all post-October net capital losses, losses on certain enumerated items of ordinary income (such as code section 988 foreign currency losses and the decline in value in an investment in a passive foreign investment company (“PFIC”)) and post-December ordinary losses not so enumerated.
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