Page 630 - Large Business IRS Training Guides

QBAI
Example 1 (cont’d)

ANALYSIS:

USP
• CFC1’s QBAI is 100x.

• CFC2’s QBAI is only
600x because
the second building is not used in the

production of tested income.
CFC1 CFC2 CFC3 CFC4
• CFC3’s QBAI is 300x and does not

include the basis
in the IP rights
because the IP rights are not tangible
property.

CFC1 CFC2 CFC3 CFC4
• CFC4 does not have QBAI because it
TI / (TL) 300x 50x 200x <300x> does not have tested income.

QBAI 100x 600x 300x -0­

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