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Jan 16, 2026 8:10 AM

IRS Proposes Tax Changes That Could Target Sovereign Wealth Funds' US Investments: Report

The Internal Revenue Service (IRS) has reportedly proposed tax changes that could hold sovereign wealth funds (SWFs) and some public pension funds accountable for taxes on their American investments.

IRS May Tax Foreign Funds' Commercial Acts

Under Section 892 of the U.S. tax code, foreign governments and their controlled entities, such as sovereign wealth funds and certain public pension funds, are exempt from U.S. taxes on activities classified by the IRS as investment-related. However, they must pay taxes if ...