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Financial Services Law Analysis and Updates for the Canadian and Cross-Border Financial Community

Category Archives: Tax

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Loans to U.S. Borrowers – Deemed Dividend Problem with Credit Support from Non-U.S. Subsidiaries

Posted in Cross-Border, Tax

When non-U.S. subsidiaries of a U.S. borrower provide credit support for loans made to their U.S. parent, unexpected and often significant U.S. tax costs can result. When structuring lending and credit support arrangements that involve U.S. borrowers and non-U.S. credit support, both borrowers and lenders should consider how to avoid unintentionally giving rise to these… Continue Reading