The information provided in the Department’s tax manuals is general in nature. The opinions expressed in the manuals are informal and do not constitute a revenue or letter ruling pursuant to the provisions of Tennessee Code Annotated § 67-1-109. Future amendments, court decisions, regulation changes, or other factors could change the opinions expressed in the manuals.
The Department updates its tax manuals in February and August of each year to clarify existing guidance, provide additional guidance, or address law changes resulting from new legislation or litigation. In order to provide guidance in the interim periods, the Department will regularly update this section with information that will be included in upcoming manuals. And like the guidance contained in the manuals, the information contained in this section constitutes “published guidance,” as defined in Tenn. Code Ann. § 67-1-108.
Franchise and Excise Tax Manual
Excise Tax Update – Foreign Derived Intangible Income (FDII)
Page 300 of the Franchise and Excise Tax Manual indicates that Tennessee has decoupled from the federal provision (I.R.C. § 250) that allows a deduction for FDII. The Department has reviewed this issue and determined that while Tennessee has decoupled from I.R.C. § 250 for purposes of global intangible low-taxed income (GILTI), it has not decoupled for purposes of the FDII deduction. Therefore, in computing “net earnings” under Tenn. Code Ann. § 67-4-2006, taxpayers are entitled to the full amount of the I.R.C. § 250(a) deduction to which it is entitled under federal law as it relates to FDII.
Date published: January 26, 2023
Click here for an overview of current updates to the Department of Revenue's tax manuals. Updates are predominately based on changes in Tennessee law pursuant to the 2021 legislative session, as well as opportunities for improved clarity or expanded guidance.
- Alcohol Tax Manual - March 2021 - July 2021
- Alcohol Tax Manual - August 2021 - February 2022
- Note: This manual includes information provided in the previous “Termination of Distribution Contract Guide.”
- Alcohol Tax Manual - March 2022 - July 2022
- Business Tax Manual - March 2021 - July 2021
- Business Tax Manual - August 2021 - February 2022
- Business Tax Manual - March 2022 - July 2022
- Agricultural Tax Manual - September 2021 - November 2022
- Agricultural Tax Manual - July 2021 - August 2021
- Franchise & Excise Tax Manual - March 2021 - July 2021
- Franchise & Excise Tax Manual - August 2021 - February 2022
- Franchise & Excise Tax Manual - March 2022 - July 2022
- Hall Income Tax Manual - March 2021 - July 2021
- Hall Income Tax Manual - August 2021 - July 2022
- Sales and Use Tax Guidance for County Clerks - Automobiles and Boats - March 2021 - July 2021