About the Course
Introduction
This course will guide tax advisers in making a Section 962 election for an individual, trust, or estate to be taxed at corporate rates on foreign-sourced income under Section 951(a) and global intangible low-taxed income (GILTI)/net CFC tested income (NCTI) to be treated in the same manner as Subpart F inclusions. The panel will show how to identify income eligible for a 962 election, detail the potential tax benefits (including indirect foreign tax credits), and discuss potential hazards to making the election.
Description
Significant changes to the international taxation of controlled foreign corporations (CFCs) require tax advisers to engage in proactive planning to minimize the tax liability on previously deferred foreign income. The One Big Beautiful Bill Act effectively raises the tax rate of specific CFC income from 10.5% under GILTI rules to 12.6% under NCTI (effective 2026), making the election more valuable for certain U.S. shareholders of CFCs.
Section 962 allows individuals or fiduciaries to be taxed at domestic corporate rates on any amounts included as gross income under IRC 951(a), including presumable GILTI/NCTI because of Section 951A(f)(1)(A), rather than at potentially higher individual or fiduciary income tax rates. An election under Section 962 can provide benefits specific to trusts and estates, given the compressed fiduciary income tax rates applicable to such taxpayers. Taxpayers making the election may also claim an indirect or deemed paid foreign tax credit under Section 960. Under the GILTI/NCTI rules, Section 960(d) provides that only domestic corporations can claim indirect foreign tax credits.
There are several areas of risk and uncertainty surrounding the 962 election, and tax advisers to individuals should proceed carefully in evaluating whether to elect domestic corporate tax treatment. When an electing taxpayer receives a distribution of earnings previously included in gross income under 951(a) or 951A(a), such taxpayer must include in gross income any distribution amount exceeding the amount of U.S. income tax paid at the time of a Section 962 election, which may result in double inclusion of previously deferred income.
Listen as our experienced panel provides a practical guide to the planning and compliance challenges of making a Section 962 election for Subpart F income and GILTI/NCTI.
Presented By
Mr. Benayoun is a Principal who specializes in consulting around international taxation for inbound and outbound multinational corporations, S corporations, partnerships, and individuals and families. He has more than 10 years of business consulting experience in international taxation with Big Four firms. Mr. Benayoun's experience includes consulting around international tax reform issues from the Tax Cuts and Jobs Act as well as structuring mergers and acquisitions as well as liquidations. He has worked extensively with clients on repatriation planning; foreign-derived intangible income (FDII) planning; treaty analysis; and foreign currency issues; and U.S. CFC and anti-deferral regimes, such as Subpart F/§956/GILTI. Mr. Benayoun is well versed tax provision work (FIN 48/FAS 109), OFL/ODL analysis, debt vs. equity analysis, FTC limitation analysis and planning, tax efficient debt financing, Permanent Establishment (“PE”) risk assessment, entity rationalization planning, and inbound work including ECI, FDAP income, withholding, treaty analysis (e.g., LOB Article, PE Article, etc.), and branch profits tax issues.
Mr. Samtoy’s practice specializes in international tax compliance and consulting services, with a focus on individuals, closely-held businesses, and hedge funds. He has particular expertise in structuring and reporting foreign manufacturing arrangements and foreign holding companies, and is experienced in foreign asset disclosure requirements, as well as foreign trust and estate reporting.
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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
Monday, June 22, 2026
- schedule
1:00 PM ET/10:00 AM PT
I. GILTI regime
II. NCTI regime
III. Section 962 election
A. Eligible income under IRC 951(a) and 951A(f)
B. Claiming IRC 960 indirect/deemed paid foreign tax credits
C. The tax rate on elected foreign income inclusion
D. Treatment of distributions where amounts previously included in gross income at the time of the election
IV. Where a Section 962 election may create a higher tax after a deferral
V. Impact of Section 962 elections on trusts and estates
A. Who may make the Section 962 election?
B. Impact of compressed fiduciary tables on effective tax rates
VI. Making the election
VII. Calculating and reporting the tax
VIII. Alternatives to the Section 962 election
The panel will discuss these and other important issues:
- What types of income are eligible for corporate tax rates under a Section 962 election?
- How to calculate the tax impact of subsequent distributions of amounts included in gross income under Section 962 election
- Determining when a Section 962 election could result in tax increases
- When do NOL benefits outweigh the benefit of making this election?
Learning Objectives
After completing this course, you will be able to:
- Determine what types of income are eligible for corporate tax rates under an IRC 962 election
- Ascertain how to calculate the tax impact of amounts included in gross income under IRC 962
- Establish whether an IRC 962 election is beneficial or could result in tax increases
- Recognize the treatment of Subpart F inclusions, GILTI/NCTI, and tax liability on previously deferred foreign income
- Verify that the IRC 962 election is correct and follow the new law's provisions regarding IRC 962 tax reporting
- 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).
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