U.S. Tax Court Holds Taxpayer Must Compute Foreign Tax Credit Using Same Method CFC Used to Apportion Interest Expense

The U.S. Tax Court issued an opinion on 16 March 2022 concerning the apportionment of interest expense with respect to stock in a controlled foreign corporation (CFC) for purposes of the computation of a foreign tax credit. The case is summarized in the opinion as follows:

The Petitioner - "P" (AptarGroup Inc.) owns stock in a CFC that apportioned interest expense under the modified gross income method. P claimed a foreign tax credit under I.R.C. § 904 with respect to tax imposed on its inco…