Page 94 - International Taxation IRS Training Guides

Post-TCJA – IRA’s Limited Application

reduced MNE’s control over when US GAAP
 TCJA

include US tax on foreign subsidiary
financials
earnings. Generally,

• Historic
foreign subsidiary earnings were included as taxable
income to USP
in 2017 and 2018 even if such earnings were
distributed to USP, i.e., the transition tax (IRC 965).
not
CFC earnings are now subject to US tax immediately
• New
either subpart F or global intangible low-taxed income
as
(GILTI).

 GILTI
requires a US shareholder to include certain

foreign earnings of
certain CFCs as taxable income
even though such earnings
have not actually been

distributed to the US
shareholder.

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