Discussion:Income/Loss of foreign subsidiary
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Discussion Forum Index --> Advanced Tax Questions --> Income/Loss of foreign subsidiary
Discussion Forum Index --> Tax Questions --> Income/Loss of foreign subsidiary
| 15 November 2008 | |
| A US company has several subsidiaries around the world, most of which are wholly owned: are the income/losses from these foreign subsidiaries taxable/deductible in the US? Please provide sources. | |
| 15 November 2008 | |
| Wow. You're a CPA, right? So I guess the first source I'd refer you to is Subchapter N of the Internal Revenue Code, perhaps with particular attention to Subpart F of Part III of Subchapter N. And go from there.
Depending on the states where the US company is subject to corporate taxes measured by income, there may be opportunities to benefit from a worldwide unitary combined report that would include the income/losses and the apportionment factor denominators of all of the members of the unitary business group, US and non-US. States where some form of worldwide combination are allowed include California, Idaho, Utah, Montana, and New Hampshire. All of those states would allow, and some other states may require, a water's edge or domestic unitary combination that may include some or all of the income and factors of the controlled foreign corporations (see Subpart F). | |
| 15 November 2008 | |
| No consolidation if the subsidiaries are treated as corporations. Sec. 7701(a)(30), Sec. 1501, Moline Properties v. Commissioner, 319 U.S. 436 (1943). | |
| 15 November 2008 | |
| Well, yes, but that has nothing to do with unitary combined reporting at the state level. Just to be clear. | |
| 15 November 2008 | |
| Ns, presumably your client is paying for you to research this. Not sure why you feel the need to ask for free research on this forum. | |
