Subpart F: When Does a CFC Receive Substantial Assistance in Performing Services?

By Lowell D. Yoder on April 14, 2016

Posted In Transfer Pricing Resource, Uncategorized

Income derived by a controlled foreign corporation (CFC) from performing services for an unrelated customer generally is not Subpart F income. However, if U.S. related persons furnish substantial assistance contributing to the performance of the services, under regulations, the CFC will be deemed to perform the services for a related person. In such case, the services income would be Subpart F income to the extent attributable to services performed outside the CFC’s country of organization.

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Tags: controlled foreign corporation, intangible property, Notice 2007-13, Subpart F, substantial assistance

Lowell D. Yoder
Lowell D. Yoder focuses his practice on cross-border mergers and acquisitions, global tax planning and international tax controversies, representing high-tech, pharmaceutical, e-commerce, financial, consumer and industrial companies. He advises on tax-efficient structuring of cross-border acquisitions, dispositions, financings, internal reorganizations and joint ventures, as well as tax-beneficial planning for intangible holding companies, global supply chains and multi-jurisdictional service arrangements. Lowell also represents clients before the Internal Revenue Service (IRS), handling audits and obtaining tax rulings. He works with an extensive network of lawyers worldwide, developing tax-favorable transactional and operational cross-border structures. Lowell is the global head of McDermott's Tax Practice. Read Lowell Yoder's full bio.

Subpart F: When Does a CFC Receive Substantial Assistance in Performing Services?

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