German Tax Authority Challenging Treaty Benefit Claims on Dividends Paid by Disregarded Entities to U.S. Parent Companies

According to recent reports, the German Federal Central Tax Office (BZSt) has recently adopted a restrictive administrative practice regarding withholding tax on dividend distributions paid by German companies (GmbHs) to U.S. parent companies. They are now frequently denying withholding tax relief on dividends paid by a German GmbH to its U.S. parent if the GmbH is treated as a disregarded enti…