Taxation of Foreign Source Income: GILTI HTE Regulations, Subpart F, Sec. 245A DRD, Sale of Interest, Attribution

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

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Conducted on Thursday, February 18, 2021

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Course Materials

This course will provide tax professionals with guidance on final and proposed regulations governing foreign source income taxation. The panel will present an in-depth analysis of changes in the application of Subpart F as a result of the TCJA, global intangible low-taxed income (GILTI), the territorial dividends received deduction (DRD), and the Code Section 962 election.


The taxation of foreign-source income is at the forefront of developing tax planning strategies for U.S. individual and corporate shareholders. Subpart F, GILTI, FDII, and the territorial DRD, and these rules' application to transfers of stock in foreign corporations, among other matters, require a careful analysis of the rules affecting the structure of offshore activities and the U.S. reporting of foreign-source income.

Subpart F imposes an immediate tax on certain U.S. shareholders of a controlled foreign corporation (CFC) when and as the CFC realizes certain income. GILTI is an expansion of U.S. tax jurisdiction beyond the boundaries of Subpart F. It increases the amount of CFC income currently taxable to the U.S. shareholders in circumstances where deferral was allowed under prior law. Also, changes to the attribution rules regarding U.S. ownership to be categorized as CFCs.

Income taxed under local law at a rate higher than 18.9 percent (based on the current U.S. corporate tax rate) can be excluded from GILTI under final regulations when a proper election is made. U.S. corporations that are shareholders of CFCs are eligible to claim a deduction that reduces the effective tax on GILTI income by 50% to 10.5 percent. While individuals cannot claim the deduction, an election under Code Section 962 may reduce the current tax payment on profits retained offshore.

Listen as our panel provides guidance on the tax rules impacting U.S. shareholders of stocks in foreign corporations, the impact of Subpart F, obtaining the DRD, transfers of interests in foreign entities, and reporting compliance.



  1. Taxation of foreign source income: An overview
  2. Code 245A and foreign-source dividends received deduction
  3. Final regulation
  4. Sales and other transfers of stock in foreign corporations
  5. Subpart F: CFC ownership attribution rules
  6. GILTI and foreign-derived intangible income


The panel will review these and other relevant issues:

  • The changes to the attribution rules
  • Understanding U.S. reporting requirements for foreign income as affected by the TCJA
  • Tax implications of sales or transfers of shares of CFCs by U.S. individual and corporate shareholders
  • Guidance for determining when electing the GILTI HTE may be beneficial
  • Best practices and planning techniques for tax professionals regarding the taxation of foreign income


Antebi, Galia
Galia Antebi

Managing Member

Ms. Antebi focuses her practice on the international and domestic tax aspects of business structuring for worldwide...  |  Read More

Apostolides, Andreas
Andreas A. Apostolides


Mr. Apostolides offers thoughtful and thorough advice to his clients and helps them find significant efficiencies in...  |  Read More

Ruchelman, Stanley
Stanley C. Ruchelman


Mr. Ruchelman concentrates his practice in the area of tax planning for transactional business operations, with...  |  Read More

Rastogi, Neha
Neha Rastogi


Ms. Rastogi is known for her thorough and professional approach to international tax matters. At Ruchelman, she...  |  Read More

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