The OBBBA makes look-through guidance relevant again

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:

1. Prevents higher effective tax rates under subpart F
2. Keeps income taxable at the lower NCTI effective rate (12.6%)
3. 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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