Foreign Earnings and Profits

Maintaining accurate foreign earnings and profits (“E&P”) and  related tax pools is essential in determining a foreign subsidiary’s  effective tax rate and prepare accurate tax returns and financial  statements. Both the Internal Revenue Service and Securities Exchange  Commission have increased their attention in this area in recent years.   A number of foreign tax computations are dependent on E&P including:

  • Foreign Tax Credit utilization;
  • Deemed paid foreign tax credits;
  • Subpart F inclusions; and
  • Effective tax rate for financial statement purposes.

Our professionals have the experience, knowledge of  processes and the software tools to assist clients with:

  • Determining and maintaining accurate E&P and tax pools;
  • Working with foreign affiliates to gather information;
  • Analyzing E&P accounting methods and related tax elections; and
  • Modeling alternative E&P repatriation scenarios