Taxation of U.S. Persons Owning Foreign Corporations: Strategies for Subpart F and GILTI Inclusions

Recording of a 90-minute premium CLE/CPE video webinar with Q&A

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Conducted on Tuesday, June 7, 2022

Recorded event now available

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Course Materials

This CLE/CPE course will guide tax counsel and advisers on the implications and potential opportunities for U.S. persons owning foreign corporations under recent IRS guidance and current tax law. The panel will discuss key tax provisions and regulations causing compliance issues for U.S. taxpayers, Subpart F tax treatment of controlled foreign corporations (CFCs), global intangible low-tax income (GILTI), significant tax modifications for U.S. persons owning stock of foreign corporations through domestic partnerships, and best practices for ensuring accurate reporting and compliance.

Description

The GILTI provisions and expanded Subpart F rules significantly impact U.S. owners of foreign corporations. Tax professionals must recognize implications and potential opportunities for U.S. persons owning foreign corporations under recent IRS guidance and current tax law.

The Subpart F rules require "U.S. shareholders" of CFCs to treat certain income types as taxable in the current year. Section 250 adds a layer of current income inclusion for CFC shareholders on global "intangible income" and provides a deduction that reduces the effective tax rate on the included income.

The repeal of Code Sec. 958(b)(4) forces certain taxpayers to include in gross income amounts under Subpart F and GILTI attributable to foreign corporations that are CFCs, even though they may have limited access to critical items to determine whether such foreign corporations are CFCs and their inclusion amounts.

Rev Proc 2019-40 provides relief to certain U.S. persons who own stock in certain foreign corporations by limiting the inquiries they must make to determine whether certain foreign corporations are CFCs. It also offers particular unrelated minority U.S. shareholders the ability to rely on limited information to calculate Subpart F and GILTI inclusions without detailed financial statement information.

Listen as our authoritative panel of international tax practitioners reviews the Subpart F rules and GILTI provisions and provides a practical guide to determining CFC ownership and reporting obligations for U.S. persons owning foreign corporations.

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Outline

  1. Prior treatment of U.S. persons owning foreign corporations
  2. Recent IRS guidance and critical takeaways
  3. U.S. tax challenges under Subpart F
  4. U.S. tax challenges under GILTI
  5. Best practices for ensuring accurate reporting and compliance

Benefits

The panel will review these and other key issues:

  • Key tax compliance challenges for U.S. persons owning foreign corporations
  • Recent IRS regulations and guidance for U.S. taxpayers
  • Expanded definition of a CFC and U.S. shareholder
  • Expansion of Subpart F and key challenges under new tax law
  • Challenges under Section 951A GILTI rules for U.S. taxpayers
  • Tax planning and methods to ensure accurate reporting and compliance

Faculty

Acharya, Pallav
Pallav Acharya, CPA, FCA, CGMA
Founder and Owner
CPA Global Tax & Accounting

Mr. Acharya provides tax and accounting services, specializing in international tax and business issues for nearly 3...  |  Read More

Garcia, Rolando
Rolando Garcia, JD, CPA
Principal
Friedman

Mr. Garcia is a principal at Friedman where he leverages more than twenty years of experience to deliver clients tax...  |  Read More

Hatch, Kris
Kris Hatch
Attorney
Fenwick & West

Mr. Hatch concentrates his practice on a broad variety of domestic and international tax matters.

 |  Read More

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