T516 INTERNATIONAL TAXATION II -- OUTBOUND INTERNATIONAL ASPECTS OF US TAX LAW
WINTER 2019
JEFFERY M KADET
UNIVERSITY OF WASHINGTON SCHOOL OF LAW TAX LLM PROGRAM
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COURSE DESCRIPTION
An introduction to the practice of US tax law with respect to the conduct by US persons of business and investment outside the US either directly or through non-US entities. This course seeks to strike a balance between the technical detail within the US tax law and the practical application of that law to typical business and investment situations. The goals of the course include:
• Achieving familiarity and understanding of the provisions of US tax law relevant to "outbound" investment
• Developing skill in applying these provisions of US law to practical business and investment situations
• Developing an ability to examine an outbound business or investment situation and to identify relevant US tax issues
• Learning to analyze the various US issues in order to arrive at conclusions and recommended courses of action
• Developing sensitivity to identify opportunities and risks
The course includes developments such as GILTI, FDII, and the BEAT that were enacted in late 2017 within the Tax Cuts and Jobs Act. The material is generally current as of January 2019.
CONTENT OF CLASS SESSIONS
Section 1 – Course Introduction and Significant Background Matters
• 01-1 Introduction
• 01-2 Building Blocks for Course
• 01-3 Mechanisms to Prevent Profit Shifting to Zero and Low-Taxed Group Members
• 01-4 A Few Tax Accounting Terms
• 01-5 Check-the-Box – Entity Classification
Section 2 – The Foreign Tax Credit
• 02-1 FTC Introduction
• 02-2 Who’s the Taxpayer?
• 02-3 FTC vs Deduction
• 02-4 What is a Creditable Tax?
• 02-5 The Deemed-Paid Foreign Tax Credit
• 02-6 The FTC Limitation
• 02-7 The FTC Carryback and Carryover
• 02-8 FTC – Accounting Methods
• 02-9 FTC – More on the §78 Gross Up
Section 3 – Subpart F and Controlled Foreign Corporations
• 03-1 Subpart F Introduction
• 03-2 Definitions – US Shareholder and Controlled Foreign Corporation
• 03-3 Subpart F Income §954
• 03-4 Deemed-Paid FTC §960
• 03-5 Previously Taxed Income Account and Investment Adjustments
• 03-6 Individual US Shareholders – Optional Election of Corporate Treatment §962
• 03-7 Special Issues under §954
• 03-8 Investment in US Property §956
Section 4 – New Mechanisms in Connection with Adoption of Territorial System in TCJA (enacted December 2017 and generally effective from 2018)
• 04-1 Transition Tax upon Transition to Territorial System §965
• 04-2 TCJA New Territorial Taxation System – Introduction
• 04-3 TCJA Foreign-Derived Intangible Income (FDII)
• 04-4 TCJA Global Intangible Low-Taxed Income (GILTI)
• 04-5 TCJA §245A Dividend Received Deduction
• 04-6 Sale of CFC Shares §1248
Section 5 – Passive Foreign Investment Companies (PFICs)
• 05-1 Passive Foreign Investment Companies
Section 6 – Transfer Pricing
• 06-1 Transfer Pricing – The “Macro” View
• 06-2 Transfer Pricing – Basic Concepts
• 06-3 Transfer Pricing – Transfer Pricing Methods
• 06-4 Transfer Pricing – Special Issues
• 06-5 Transfer Pricing – Recognizing Issues and Managing Risk
• 06-6 Transfer Pricing – More on Correlative adjustments
• 06-7 Transfer Pricing – TP and Disregarded Entities
Section 7 - Base Erosion and Anti-Abuse Tax
• 07-1 Why Was the BEAT Needed?
• 07-2 Mechanics and Potential Effects on U.S. Multinationals
Section 8 – Bringing It All Together
• 08-1 Applying Intl Tax to a Hypothetical Case Study
• 08-2a Applying Intl Tax to Apple – Part I
• 08-2b Applying Intl Tax to Apple – Part II
• 08-3 Short Discussion on an Aspect of CFC Structuring
• 08-4 Short Discussion on the Use of Local Companies that Recognize Revenues
• 08-5 Short Discussion on U.S. Parent Having §250 Deductions for Both FDII and GILTI
Section 9 – Certain International Transfers
• 09-1 Certain Outbound Transfers of Tangible Property §367(a)
• 09-2 Certain Outbound Transfers of Intangible Property §367(d)
See also the Winter 2011 T516 Course on this Channel. While the material covered is mostly the same as for this Winter 2019 course (except for the TCJA material that only became effective generally from 2018), there are additional matters covered that are still applicable. These include, for example, some tax treaty and foreign exchange issues. In addition, there are “Bringing It All Together” sections that will be helpful. Viewing the 2011 version will also provide reinforcement of the material.
If any viewer of this course would find the PPTs and certain other course materials useful, please email kadetj@uw.edu to obtain a link to download them.
