ForCo, a foreign corporation, receives interest income of $50,000 from USCo, an unrelated domestic corporation. USCo historically has earned 79% of its gross income from active foreign-source business income. What amount of
ForCo's interest income is U.S.-source?

Question

Quizplus · Accepted Answer

The interest income received by ForCo from USCo is considered U.S.-source income because it is paid by a domestic corporation, regardless of the payer's income composition.

ForCo, a Foreign Corporation, Receives Interest Income of $50,000 from USCo