GILTI Calculator (Section 951A) 2026 β Global Intangible Low-Taxed Income
Calculate GILTI inclusion from CFC tested income and QBAI. Section 250 deduction analysis, Section 962 election cost-benefit, and 80% foreign tax credit for US shareholders.
$
CFC gross tested income minus allocable deductions $
Adjusted basis of tangible property (NDTIR = 10% Γ QBAI) $
Taxes paid to foreign governments (for FTC calculation) %
Must be β₯ 10% to be a US shareholder %
Applicable if no 962 election (ordinary income rate) $0
US GILTI Tax After FTC
$0
GILTI Inclusion
$0
Section 250 Deduction
$0
Foreign Tax Credit (80%)
GILTI Calculation Steps
How to Use This GILTI Calculator
Enter your CFC's net tested income, QBAI (tangible property investment), foreign taxes paid, and your ownership percentage. Toggle the Section 962 election to compare individual vs corporate rate treatment. Results show your US GILTI inclusion, Section 250 deduction, foreign tax credit, and net US tax due.
The Formula
NDTIR = QBAI Γ 10% (Net Deemed Tangible Income Return)
GILTI = max(0, Net Tested Income β NDTIR) Γ Ownership%
With Section 962 Election:
GILTI Tax = GILTI Γ 21% (corporate rate)
Section 250 Deduction = GILTI Γ 50% β effective 10.5%
FTC = min(Foreign Taxes Γ 80%, GILTI Tax)
Net US Tax = max(0, GILTI Tax after deduction β FTC)
Without Section 962 Election (individual):
GILTI Tax = GILTI Γ Individual Rate (up to 37%)
No Section 250 deduction; limited FTC
GILTI = max(0, Net Tested Income β NDTIR) Γ Ownership%
With Section 962 Election:
GILTI Tax = GILTI Γ 21% (corporate rate)
Section 250 Deduction = GILTI Γ 50% β effective 10.5%
FTC = min(Foreign Taxes Γ 80%, GILTI Tax)
Net US Tax = max(0, GILTI Tax after deduction β FTC)
Without Section 962 Election (individual):
GILTI Tax = GILTI Γ Individual Rate (up to 37%)
No Section 250 deduction; limited FTC
Example
Maria, 100% owner of Irish CFC, tested income $1M, QBAI $200K, β¬100K foreign tax paid:
NDTIR: $200,000 Γ 10% = $20,000
GILTI inclusion: $1,000,000 β $20,000 = $980,000
Section 250 deduction (50%): $490,000
Taxable GILTI: $980,000 β $490,000 = $490,000
Tax at 21%: $490,000 Γ 21% = $102,900
FTC (80%): $100,000 Γ 80% = $80,000
Net US GILTI tax: $102,900 β $80,000 = $22,900
Effective rate on tested income: 2.29%
NDTIR: $200,000 Γ 10% = $20,000
GILTI inclusion: $1,000,000 β $20,000 = $980,000
Section 250 deduction (50%): $490,000
Taxable GILTI: $980,000 β $490,000 = $490,000
Tax at 21%: $490,000 Γ 21% = $102,900
FTC (80%): $100,000 Γ 80% = $80,000
Net US GILTI tax: $102,900 β $80,000 = $22,900
Effective rate on tested income: 2.29%
Extended
Section 962 Election + Multi-CFC Aggregation
Compare 962 election vs no election and model multiple CFC scenarios
Side-by-side comparison of Section 962 election vs no election on your GILTI inclusion.
| Metric | With 962 Election | Without 962 Election |
|---|
Note: The 962 election creates a "toll charge" on future actual distributions from the CFC. You should compare the tax now vs the deferral benefit plus distribution tax later.
How US GILTI tax varies based on the effective foreign tax rate paid by your CFC.
| CFC Effective Foreign Rate | FTC Available (80%) | US GILTI Tax (with 962) | Total Effective Rate |
|---|
Breakeven: CFC paying β₯13.125% foreign tax rate can potentially eliminate US GILTI tax with 962 election and 80% FTC.
Frequently Asked Questions
What is GILTI and who is subject to it?
GILTI (Global Intangible Low-Taxed Income) under IRC Section 951A requires US shareholders who own 10% or more of a Controlled Foreign Corporation (CFC) to include certain low-taxed income from the CFC in their US taxable income each year. GILTI is calculated as the CFC's tested income minus a 10% return on Qualified Business Asset Investment (QBAI β tangible property). The purpose is to discourage profit-shifting to low-tax jurisdictions.
How is GILTI calculated?
GILTI = Net Tested Income β Net Deemed Tangible Income Return (NDTIR). Net Tested Income = CFC's gross tested income minus deductions. NDTIR = 10% Γ QBAI (qualified business asset investment, i.e., adjusted basis of tangible property used in tested income activities). If NDTIR exceeds tested income, GILTI is zero. The inclusion is proportional to the US shareholder's ownership percentage.
What is the Section 250 deduction for corporations?
US C corporations can deduct 50% of their GILTI inclusion under Section 250, reducing the effective tax rate to approximately 10.5% (21% Γ 50%). After 2025, under the TCJA sunset, the deduction drops to 37.5% (unless legislatively restored β the OBBBA may maintain 50%). Individual US shareholders do not automatically get the Section 250 deduction unless they make a Section 962 election to be taxed as a corporation.
What is the Section 962 election for GILTI?
A Section 962 election allows an individual US shareholder of a CFC to elect to be taxed on GILTI and Subpart F income at corporate rates (21%) rather than individual ordinary income rates (up to 37%). More importantly, the election enables the taxpayer to claim: (1) the Section 250 deduction (50% GILTI deduction), and (2) an 80% foreign tax credit on taxes paid by the CFC. The election is made annually on a timely-filed return. The downside: future actual distributions from the CFC may be taxed again (less credit basis).
How does the 80% foreign tax credit work for GILTI?
Under Section 960, US shareholders (or those making a 962 election) can claim a foreign tax credit equal to 80% of their proportionate share of CFC taxes paid. This is reduced from 100% to account for the limitation that you can only credit what you include. For GILTI, the effective tax rate is: Corporate rate (21%) Γ 50% deduction = 10.5%, offset by FTC = 80% Γ CFC taxes. If the CFC pays β₯13.125% foreign tax, the FTC can eliminate US GILTI tax entirely for corporations. Individual shareholders without 962 election may pay US rates (37%) with limited or no FTC.