Girlvania wont show mouse cursor1/13/2024 ![]() ![]() This proposal has three constituent elements: 1) modifications to the GILTI regime, 2) disallowance of deductions attributable to exempt income, and 3) substantial expansion of the provisions to limit inversions. The Biden Administration proposed three principal changes to the GILTI rules that were enacted under the Tax Cuts and Jobs Act of 2017 (TCJA).įirst, the proposal would eliminate the concept of QBAI under the GILTI rules. ![]() shareholder is taxed on a GILTI inclusion only to the extent that the shareholder's tested income of its controlled foreign corporations (CFCs) exceeds a 10 percent return on certain foreign tangible property eligible for depreciation (i.e., QBAI). The proposal to eliminate QBAI would therefore increase the base of CFC income subject to GILTI and substantially circumscribes the foreign -source earnings of a CFC eligible for a Section 245A deduction. The Green Book concludes that the elimination of QBAI would eliminate the incentive for U.S. multinational companies to invest in tangible assets abroad rather than domestically. Second, the proposal would reduce the deduction under Section 250 that applies to U.S.
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