Suppose a US corporation (tax rate 34%) with $2,500,000 of domestic income sets up a branch in Japan earning $800,000, where the tax rate is 50%. Also, assume I earned another $100,000 in interest revenue in a country with a 10% income tax rate...like Ireland. Using the outline below, calculate the foreign tax credit and total tax liability for the corporation.
- Income
- US Sourced (here need to fill out )
- Japanese Branch
- Irish Branch
- Tax Base
- US Tax Rate
- US Tax
- Foreign Taxes Paid
- Foreign Tax Credit
- US Tax Liability
- Total Income Tax Liability