Philip Hodgen

Hello again, welcome to another episode of the Form 5471 show. I am your host, Phil Hodgen. This is Episode 3 of a series where we track $1,000 of subpart F income by a lower-tier CFC subsidiary, with cash distributions all the way up the stack to the U.

How much income is reported on this shareholder’s Form 1040? Why? Why does Subpart F income jump directly from the bottom-level controlled foreign corporation to the United States shareholder’s Form 1040? Doesn’t it make more sense to pass the income item up the holding structure from subsidiary