About the Course
Introduction
This webinar will explore how a controlled foreign corporation's (CFC) disposition is taxed. Our panel of international tax planning attorneys discusses the types of income that create a U.S. tax obligation and methods of dissolution. They will point out caveats and offer planning advice for CFC stock dispositions, including coverage of Section 1248 dividend treatment, the election under Section 962 to tax individuals at corporate rates, and F reorganizations.
Description
Exiting a CFC can result in long-term capital gains, ordinary income tax, or, in certain situations and with proper planning, be tax-free. A taxpayer must first consider the type of income received by a CFC. Only in certain circumstances is income earned by a corporation outside the U.S. taxed. Generally speaking, income effectively connected to a U.S. trade or business and fixed or determinable annual or periodic income, FDAP, is not subject to U.S. corporate income tax. At the same time, Subpart F income and GILTI/NCTI income are subject to U.S. tax reporting.
Liquidation of a CFC or a check-the-box election can result in Subpart F or GILTI/NCTI income. While the top individual income tax rate is 37%, the top corporate income tax rate is 21%. Proper planning and an election under IRC Section 962 can mitigate taxes owed by certain CFC shareholders. CFC owners and their tax advisers need to understand the tax implications of exiting a CFC and the strategies available to lessen the tax consequences of CFC liquidations.
Listen as our panel of foreign tax specialists explains the tax ramifications of a CFC disposition and offers advice and strategies for CFC shareholders and their tax advisers.
Presented By
Mr. Klug is a trusted attorney with extensive experience in taxation, corporate planning, mergers and acquisitions, and estate planning. With decades of experience advising clients on everything from corporate tax structuring and cross-border transactions to private equity, estate planning, and family office strategy, he brings a rare blend of big law pedigree and boutique, hands-on partnership.
Ms. Lee is a trusted tax advisor with extensive experience in navigating the complexities of U.S. tax law and tax treaties, offering strategic counsel to her clients in the areas of individual and business tax planning, compliance, and controversies, as well as domestic and international estate planning. She has been instrumental in facilitating new business entity formation and fund formation, ensuring that her clients remain compliant with corporate regulatory requirements. Ms. Lee is admitted to the California Bar and fluent in Korean.
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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, May 21, 2026
- schedule
1:00 PM ET/10:00 AM PT
I. Exiting a CFC: introduction
II. Categories of income
A. ECI – effectively connected income
B. FDAP – fixed or determinable annual or periodic income
C. GILTI/NCTI
D. Subpart F
III. Methods of dissolution
A. Check-the-box elections
B. Liquidations
IV. Tax considerations
C. Section 1248 dividends
D. Section 962 election
E. F reorganizations
F. Other considerations
V. Examples
The panel will cover these and other critical issues:
- How a check-the-box election can create a taxable event
- The impact of Section 1248 on CFC stock exchanges
- Circumventing tax with an F reorganization
- Utilizing a Section 962 election to mitigate tax
Learning Objectives
After completing this course, you will be able to:
- Determine when gains from the sale of a CFC are subject to Section 1248
- Identify types of CFC income that are subject to U.S. tax
- Ascertain tax savings strategies for exiting a CFC
- Decide which taxpayers could benefit from a Section 962 election
- 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 .
