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Federal Calculation of GILTI for U.S. Shareholders
Income Tax Guidance on Global Intangible Low-Taxed Income GILTI For Corporations, Individuals, Trusts, and Estates
Federal Calculation of GILTI for U.S. Shareholders
IRC 951A provides:
Each person who is a United States shareholder of any controlled foreign corporation for any taxable year of such United States shareholder shall include in gross income such shareholder’s global intangible low-taxed income for such taxable year.3
The federal determination of U.S. shareholder4 or controlled foreign corporation5 (“foreign corporation”) status and the complexities of calculating GILTI are beyond the scope of this notice. However, in very general terms, GILTI is a U.S. shareholder’s pro-rata share of:
Foreign corporations’ net income not subject to U.S. tax
less
Each foreign corporation’s presumed 10% return on its tangible business assets, with adjustments
3IRC 951A(a). Emphasis added.
4IRC 951A(e)(2).
5IRC 951A(e)(3).