U.S. Company With a China or Hong Kong Subsidiary: CFC Rules, Form 5471 and the 2026 NCTI Changes
A foreign subsidiary more than 50% owned by U.S. shareholders is a CFC: file Form 5471 every year or face penalties from $10,000. Subpart F and NCTI (formerly GILTI) can be taxed without a dividend; from 2026 QBAI is gone, the C corporation deduction is 40% and the foreign tax credit 90%.
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