Supplemental Materials: Detailed examples of US International Tax Reform Proposals
Deferral of Certain U.S. Income Tax Deductions •
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Application – Foreign related deductions of the U.S. company deferred unless foreign source income is taxed currently – Deferred deductions carried forward and treated as current year expenses for purposes of determining allowed expenses in that year Effects – Increases the cost of capital – Increases cost of performing SG&A in the U.S.
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Considerations – – – –
Review expense allocation Recognize built-in gains in CFCs Reevaluate charge-outs and location of SG&A functions E&P studies 17