Bill > HR4464

This bill, titled the Permanent CFC Look-Through Act of 2014, aims to make permanent a tax rule that allows certain payments between related controlled foreign corporations (CFCs) to be treated as "look-through" income, meaning they are not subject to immediate U.S. taxation. CFCs are foreign corporations where U.S. shareholders own more than 50% of the stock. The "look-through" treatment, as described in Section 954(c)(6) of the Internal Revenue Code, exempts dividends, interest, rents, and royalties received or paid between these related CFCs from being classified as "foreign personal holding company income," which would otherwise be taxed in the U.S. even if the income is earned abroad. By making this provision permanent, the bill ensures that U.S. companies can continue to defer U.S. taxes on these intercompany payments until the income is repatriated, a practice that was previously set to expire.