FDII Deduction and GILTI Rules: Claiming Section 250 Tax Incentives on Eligible Foreign Income

QBAI, Expense Allocations, Sale of Property Provisions, Deduction-Eligible Income, FDDEI Transactions, Ordering Rules

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

This program is included with the Strafford CPE Pass. Click for more information.
This program is included with the Strafford CPE+ Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Monday, December 6, 2021

Recorded event now available

or call 1-800-926-7926
Course Materials

This course will provide corporate tax advisers with a practical guide to the tax planning opportunities and challenges of the Section 250 FDII deduction. The panel will discuss how the final regulations impact the treatment of certain transactions to calculate deduction-eligible income and offer suggestions on tax-efficient structures to take advantage of tax savings built into the FDII deduction.

Description

The final regulations on Section 250 FDII deductions provide opportunities and additional challenges in multinational tax planning for U.S. businesses with offshore operations. The 37.5 percent deduction for FDII and the 50 percent deduction for GILTI yield comparable effective tax rates of 13.125 percent.

The final regulations relaxed the strict documentation guidelines for supporting an FDII deduction and substantially changed the rules for determining when a transaction generates FDDEI (foreign-derived deduction eligible income). Tax advisers must have a practical grasp of the FDII regulations to avoid costly tax consequences.

Listen as our expert panel provides a practical guide to the planning opportunities and reporting challenges of the FDII deduction for U.S. corporations.

READ MORE

Outline

  1. Section 250(a) FDII deduction
  2. Interplay with GILTI provisions
    1. Rate structure
    2. Export incentive
  3. IRS proposed regulations
    1. FDDEI transactions
    2. Ordering rules
    3. Components of FDII computation
    4. Anti-abuse rules
  4. Deductibility of certain related-party transactions
  5. Impact of foreign tax credit changes to FDII
  6. Offshore structuring considerations to take advantage of FDII
  7. Impact of impending legislation

Benefits

The panel will review these and other relevant topics:

  • The interplay between Section 250(a) FDII deduction and GILTI provisions
  • Recent IRS regulations on calculating the FDII deduction
  • Rules applicable to FDDEI transactions
  • Ordering rules for computing the FDII deduction
  • How to go through the multi-step process to identify, calculate, and claim the FDII deduction
  • Which assets qualify as QBAI and which assets do not
  • Planning opportunities around the FDII deduction

Faculty

Skinner, William
William R. Skinner

Partner
Fenwick & West

Mr. Skinner focuses his practice on U.S. international taxation, with a particular emphasis on tax planning and...  |  Read More

Brandon, Kyle
Kyle Brandon

Senior Manager - International Tax
Grant Thornton

Mr. Brandon is an international tax executive focused on helping multinational businesses address their global tax...  |  Read More

Access Anytime, Anywhere

CPE credit is not available on downloads.

CPE On-Demand

See NASBA details.

Download