How U.S. Taxpayers Are Taxed on Foreign Activities

This course provides a detailed exploration of the taxation rules that apply to U.S. taxpayers engaged in foreign activities. Traditionally, U.S.-based shareholders of foreign corporations could defer tax on income earned abroad until it was repatriated. However, the introduction of Global Intangible Low-Taxed Income (GILTI) has significantly reduced this deferral ability. The course will cover the historical context of deferral through Subpart F, the impact of GILTI on foreign operations, and the strategic considerations brought about by recent regulations. Attendees will also learn about the Foreign-Derived Intangible Income (FDII) deduction, an appealing alternative that offers significant tax savings on foreign sales and services.

Learning Objectives:

1. Explore the historical context of U.S. taxation on foreign income, including deferral and Subpart F income
2. Analyze the impact of the GILTI provisions on U.S. taxpayers with foreign operations
3. Evaluate the implications of the July 2020 GILTI regulations on outbound structuring decisions
4. Explore the benefits and limitations of the FDII deduction as an alternative to GILTI
5. Apply key tax strategies to optimize foreign operations and minimize U.S. tax liabilities