What is the branch profits tax under IRC 884 and does it apply to my foreign corporation doing business in the U.S.?
I have a Japanese corporation that operates a trading office in Los Angeles. My U.S. tax advisor mentioned a 'branch profits tax' under IRC 884 that would apply on top of the regular corporate income tax. He said it's like a second layer of tax. I'm already paying 21% corporate tax on the effectively connected income — why is there another tax? And is this something the U.S.-Japan treaty can help with?
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