The legal reasoning behind the answer to this question is based on the provisions of the Internal Revenue Code (IRC) and Treasury Regulations that govern the treatment of foreign dividends and the application of section 245A and section 367(b) in the context of a reorganization.
Section 245A of the IRC allows a deduction for the foreign-source portion of dividends received by a domestic corporation from a specified 10-percent owned foreign corporation. However, this provision is subject to certain exceptions. For instance, subsection 245A(e)(1) states that subsection (a) shall not apply to any dividend received by a United States shareholder from a controlled foreign corporation if the dividend is a hybrid dividend. Additionally, subsection 245A(f) states that any amount which is treated as a dividend under section 1291(d)(2)(B) shall not be treated as a dividend for purposes of this section.
On the other hand, section 367(b) of the IRC provides rules for the treatment of property transfers in connection with certain corporate reorganizations involving foreign corporations. In certain circumstances, the nonrecognition treatment normally accorded to the transferor corporation and its shareholders in an international reorganization is modified by the operation of sections 367, 897(d) and (e), and 1291(f) and the regulations thereunder.
The interplay between these two sections in the context of a reorganization is not explicitly addressed in the retrieved information. Therefore, it is not clear whether a taxpayer can exclude foreign dividends in a 367(b) reorganization by relying on section 245A. The application of these provisions would likely depend on the specific facts and circumstances of the reorganization, including the nature of the foreign dividends, the structure of the reorganization, and the status of the corporations involved.
In conclusion, based on the retrieved information, it is not possible to definitively answer the question of whether you can exclude foreign dividends in a 367(b) reorganization by relying on section 245A.
Sources:
LTR 8742017
Rev. Rul. 91-5
T.D. 8280
Rev. Rul. 89-103
§ 245A. Deduction for foreign source-portion of dividends received by domestic corporations from specified 10-percent owned foreign corporations
Notice 2016-73
§ 245. Dividends received from certain foreign corporations
Rev. Rul. 74-297
