Overview
The foreign tax credit plays a fundamental role in ameliorating potential double taxation of foreign earnings in the new 15% book minimum tax enacted in the Inflation Reduction Act (IRA) of 2022. The IRA permits a credit for direct foreign taxes and a pro rata share of controlled foreign corporation (CFC) taxes (subject to a limitation of 15% of CFC income).
In a Leading Practitioner column for Bloomberg Tax Management International Journal, titled "The Book Minimum Tax Foreign Tax Credit: New and Lingering Issues," partner Amanda Pedvin Varma writes about the foreign tax credit aspects of the 15% book minimum tax, including issues likely to be addressed by Treasury and the IRS in guidance.
The full article can be read in Bloomberg Tax Management International Journal.
