Skip to content
Subscriber Only
Business

Crackdown Targets Inversions Designed to Limit U.S. Taxes

Employees work on stent graft components in a sterile environment at the Medtronic Inc. assembly plant in Tijuana, Mexico, on Oct. 27, 2014.

Employees work on stent graft components in a sterile environment at the Medtronic Inc. assembly plant in Tijuana, Mexico, on Oct. 27, 2014.

Photographer: David Maung/Bloomberg
By
Richard Rubin and Ian Katz

The Treasury Department announced steps that will make it harder for U.S. companies to move their addresses outside the country to reduce taxes, clamping down on the practice known as inversions.

The rules, which apply to deals that close starting today, include a prohibition on “hopscotch” loans that let companies access foreign cash without paying U.S. taxes, and impose new curbs on actions that companies can use to make such transactions qualify for favorable tax treatment.