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TC.004
Under the baseline tax system, worldwide income forms the tax base of U.S. corporations. In contrast, U.S. tax law exempts or preferentially taxes certain portions of this income. Prior to the passage of the Tax Cuts and Jobs Act TCJA (effective January 1, 2018), active foreign income was generally taxed only upon repatriation. TCJA changed these rules, so that certain active income (called “global intangible low tax income” or “GILTI”) is taxed currently, even if it is not distributed. However, U.S. corporations generally receive a 50 percent deduction from U.S. tax on their GILTI (the deduction decreases to 37.5 percent in 2026), resulting in a substantially reduced rate of tax. In addition, some active income is excluded from tax, and distributions out of active income are no longer taxed upon repatriation. These reductions and exemptions from U.S. taxation are considered tax expenditures.
This chart shows obligations for the program by fiscal year. All data for this chart was provided by the
administering agency and sourced from SAM.gov, USASpending.gov, and Treasury.gov.
For more information on each of these data sources, please see the
About the data page.
OMB is working with the U.S. Government Accountability Office (GAO) and agency offices of inspectors general to include links to relevant oversight reports. This section will be updated once this information is made available.
