Page 720 - Large Business IRS Training Guides

Section 965(c)
Deduction 2

• A section 958(a)
U.S. shareholder with a section 965(a)

allowed a deduction intended to result
inclusion amount i s
in the inclusion being taxed at a 15.5%
rate to the extent
U.S. shareholder’s
attributable to the section 958(a)
aggregate foreign cash position (“AFCP”),
and at 8%

otherwise.

• These tax rates
are generated by providing for a
deduction equal
to the sum of:

rate equivalent percentage x AFCP
15.5 percent
(not t o
exceed amount of the
income inclusion)

and

8 percent rate equivalent
percentage x (amount of income
– AFCP)
inclusion
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