- Aug 4, 2021
There is a new twist in tax law in the US which was signed by President Donald Trump last month. It comes with good news to all those companies who began their fiscal years before January 1. This is largely going to benefit companies such as Apple Inc., Microsoft Corp. and Cisco Systems Inc.
Congress has discarded the previous international tax system for corporations and came up with new system. This revised system allows companies to defer the US income taxes on foreign earnings until they returned the income to the US. Due to this deferral provision, up to $3.1 trillion is estimated to stockpile by companies offshore.
This revised system resulted for Apple to get benefit more than $4 billion off a future tax bill, as it disclosed an offshore cash hoard of $252 billion as of September 30. Further, this new tax system has focused on domestic economic activity. The congressional tax writers also imposed a two-tiered levy on all that accumulated foreign income where cash will be taxed at 15.5 percent, less liquid assets at 8 percent which the companies can pay over eight years.