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PFIC to CFC—Understanding Filing Requirements and Overlap

In this presentation, trace the evolution of the U.S. owners’ filing requirements with respect to a foreign startup company over the years as more U.S. owners buy in and the total U.S. ownership increases.

Examine the Form 8621 and Form 5471 filing requirements for each year for each of the US individuals involved. Cover how to make a purging election to tax the startup as a CFC (and not a PFIC) in the final year. Finally, briefly discuss the option of making a QEF election for the pre-CFC years.

Presenter: Deba Rudd

Materials: Dropbox