A U.S. corporation makes deductible payments to its foreign parent company, potentially reducing its U.S. tax liability. Which form is used to determine the tax applicable to this... A U.S. corporation makes deductible payments to its foreign parent company, potentially reducing its U.S. tax liability. Which form is used to determine the tax applicable to this base erosion? A) Form 8992 B) Form 5472 C) Form 8993 D) Form 8991
Understand the Problem
The question is asking which specific tax form is utilized by a U.S. corporation to assess tax implications related to deductible payments made to its foreign parent company, which can influence its U.S. tax liability due to base erosion. The question presents options that likely relate to tax reporting requirements for transactions between U.S. entities and foreign entities.
Answer
Form 8991
The correct form is Form 8991.
Answer for screen readers
The correct form is Form 8991.
More Information
Form 8991 is used to calculate the base erosion and anti-abuse tax (BEAT), which applies to certain payments made by U.S. corporations to foreign related parties to prevent erosion of the U.S. tax base.
Tips
A common mistake is confusing it with forms related to other international tax provisions like GILTI (Form 8992) or FDII (Form 8993).
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