Subpart F income is passive and usually derived from operations in a tax-haven country.

Question

Quizplus · Accepted Answer

Subpart F income is generally defined as “passive income” earned by a foreign subsidiary of a US-based multinational corporation, which is not subject to US taxation until the income is repatriated to the US parent company. This income is often derived from operations in a tax-haven country, where the subsidiary may be incorporated and where taxes are relatively low.

Subpart F Income Is Passive and Usually Derived from Operations