Court of Appeals confirms that interest deduction disallowance does not violate 1967 US-France tax treaty The US Court of Appeals for the Seventh Circuit has confirmed a decision of the US Tax Court that the interest deduction disallowance rule of Treasury Regulation § 1.267(a)-3 does not violate Art. 24(3) (Non-discrimination) of the 1967 US-France tax treaty (Square D Company v. Commissioner, Docket No. 04-4302, 13 February 2006). Treasury Regulation § 1.267(a)-3 prevents US taxpayers from claiming a tax deduction for an expense owed to related foreign persons until such time as the expense is actually paid. The effect of the...