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The OBBBA makes look-through guidance relevant again
Sept. 2, 2025 · Authored by James C. Lawson
Big update in international tax: The OBBBA has permanently extended section 954(c)(6). Baker Tilly’s James C. Lawson explained to Forbes that this means qualifying taxpayers will continue to benefit from an exception to subpart F income, ensuring income remains under the net CFC taxable income (NCTI) rules instead.
Why it matters:
- Prevents higher effective tax rates under subpart F
- Keeps income taxable at the lower NCTI effective rate (12.6%)
- Gives taxpayers confidence to revisit structures that were hedging against expiration of the look-through rule
Now’s the time for multinational companies to re-examine intercompany structures in light of this permanent change.
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