About the Course
Introduction
This course will explain the tax considerations for foreign branches, including what constitutes a foreign branch and its U.S. reporting obligations; calculating foreign branch income and the related foreign tax credit; anti-hybrid regulations; and the impact of recent tax legislation on the taxation of foreign branches.
Description
A U.S. company can conduct business through a branch in another country or through a foreign entity that is disregarded in the U.S. Generally, a foreign branch is a trade or business operated in a foreign country that maintains its own set of books and records. Although Section 989 defines a foreign branch as a qualified business unit, whether it is a trade or business is a facts-and-circumstances determination.
Income or loss from a foreign branch is reported on a U.S. consolidated income tax return, which can provide substantial benefits to the group when the branch is reporting losses. Dual losses—deducting the same loss in both countries—are prohibited. Reporting income provides additional complexities. The allocation and reallocation rules for foreign branch income must be analyzed to determine the allowable foreign tax credit. Foreign branch income is subject to a 21% tax rate. They are ineligible for the Section 250 FDII deduction, which lowers effective tax rates to 13.125% under GILTI and 12.6% under NCTI.
The centerpiece of the U.S. system for mitigating international double taxation is the FTC. The One Big Beautiful Bill Act (OBBBA) implemented new sourcing rules for certain U.S.-produced inventory sold abroad through foreign branches. Up to 50% of qualifying inventory can be treated as foreign source income for the foreign tax credit.
Listen as our panel of foreign tax experts explains the tax considerations of operating a foreign branch, including planning strategies to lower the overall tax burden of multinational trade or businesses.
Presented By
Ms. Demorizi founded illumina CPA Group after a distinguished 20+ year career with Deloitte and PwC, serving leading private equity and venture capital firms, Fortune 500 companies, private companies, and high-net-worth individuals across the US and globally. Her vision for the company is to play a crucial role in helping middle-market businesses navigate the often complex world of taxation, especially with the added layers of cross-border and international considerations, and to bring practical strategies and solutions throughout the entire lifecycle. Ms. Demorizi's core competencies span various disciplines: US and international tax planning and reporting, M&A deal structuring and tax due diligence, fund and management company structuring, global structuring for private and public companies, supply chain/value chain transformation, Pillar Two assessments, income tax provision/ASC 740, and tax planning for high-net-worth individuals.
With more than 30 years of legal experience, Mr. Martin’s practice focuses on a wide range of international tax issues. He assists domestic and foreign privately held companies, global investors, funds and other business entities with their international tax treaty planning strategies as well as worldwide investments and financing structures. Mr. Martin also advises multi-national families on issues related to worldwide income, estate, gift, inheritance, and tax withholding planning, as well as international wealth preservation structures. He has a wealth of experience in international tax controversies and routinely defends international taxpayers before the relevant tax authorities, including the IRS. Mr. Martin is a Fellow of the American College of Tax Counsel (ACTC) and of the American College of Trust & Estate Counsel (ACTEC). He is also the former chair of the State Bar of California, Taxation Section.
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BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.
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BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
Date + Time
- event
Thursday, September 24, 2026
- schedule
1:00 PM ET/10:00 AM PT
I. Foreign branches: overview
II. Foreign branch loss recapture under Section 91
III. Subpart F and GILTI/NCTI
A. Section 954(d)(2) branch income rules
B. GILTI and Subpart F high-tax exceptions
IV. Foreign tax credit
V. Anti-hybrid rules
VI. Form 8858 reporting
VII. Planning strategies
The panel will review these and other critical issues:
- Defining foreign branches and QBUs and applying check‑the‑box rules
- Filing requirements for Form 8858 and Schedule M
- Section 267A anti-hybrid and branch mismatch rules
- Planning strategies to optimize structure and manage global tax exposure
Learning Objectives
After completing this course, you will be able to:
- Identify foreign branch and disregarded entity structures
- Apply FTC rules to foreign operations
- Evaluate anti‑hybrid risks in cross‑border transactions
- Determine reporting obligations for foreign branches and QBUs
- Field of Study: Taxes
- Level of Knowledge: Intermediate
- Advance Preparation: None
- Teaching Method: Seminar/Lecture
- Delivery Method: Group-Internet (via computer)
- Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
- Prerequisite:
Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of international taxation, including residency determination, foreign entity classifications, application of treaty benefits, as well as GILTI/NCTI, Subpart F, and the related Section 250 deductions.
BARBRI, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.
BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
BARBRI CE webinars-powered by Barbri-are backed by our 100% unconditional money-back guarantee: If you are not satisfied with any of our products, simply let us know and get a full refund. Contact us at 1-800-926-7926 .
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