Before the Tax Cuts and Jobs Act (TCJA), U.S. taxpayers who were shareholders in foreign corporations were generally not taxed on the earnings of the corporations until U.S. repatriation. If the foreign corporation did not distribute earnings back to the U.S., shareholders could postpone paying taxes on the foreign income indefinitely.
Under the new Internal Revenue Code 965, however, U.S. multinational entities must pay a one-time mandatory repatriation tax on undistributed and deferred post-1986 income. How does the new repatriation tax impact the 2017 and 2018 financial statements of certain multinational entities? Find out here.