ForeignCorp is a Country Y corporation that is not a bank; and is engaged in a USTB. The interest expense that is allocated to the ECI of ForeignCorp's USTB totals $25,000 in 2023, as determined under Reg. § 1.882-5. Of that amount, $18,000 is "branch interest," which is paid by the U.S. branch to Matthews, an unrelated Country Y nonresident alien. No tax treaty applies. Is the $18,000 of branch interest paid to Matthews portfolio income?

ForeignCorp is a Country Y corporation that is not a bank; and is engaged in a USTB. The interest expense that is allocated to the ECI of ForeignCorp's USTB totals $25,000 in 2023, as determined under Reg. § 1.882-5. Of that amount, $18,000 is "branch interest," which is paid by the U.S. branch to Matthews, an unrelated Country Y nonresident alien. No tax treaty applies. Is the $18,000 of branch interest paid to Matthews portfolio income?

Business Its Legal Ethical & Global Environment

10th Edition

ISBN:9781305224414

Author:JENNINGS

Publisher:JENNINGS

Chapter7: International Law

Section: Chapter Questions

Problem 4QAP

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