How Are States Taxing the Income Called GILTI?
Talking Tax17 Okt 2019

How Are States Taxing the Income Called GILTI?

The federal tax on a category of income called GILTI—global intangible low-taxed income—has state-level implications for multinational businesses. Congress created GILTI to stop companies from shifting profits abroad through intangible assets—royalties, patents, and the like. When a company’s total overseas income has been taxed abroad at less than a certain rate, the U.S. applies a tax. In the U.S., state governments often conform their own tax laws to the federal tax code. But with GILTI, states are all over the map. For most states it means a very modest increase in their corporate tax base, but for companies it can mean dealing with multiple approaches and calculations. And there’s talk of legal challenges. Talking Tax host Siri Bulusu talked about GILTI with Bruce Fort, counsel to the Multistate Tax Commission, who has an eagle’s-eye view of what the states are doing. They spoke at the American Bar Association tax section’s fall meeting in San Francisco.

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