The Supreme Court, in a unanimous decision, has held that a one-time U.K. windfall tax paid by the subsidiary of a U.S. corporation is creditable against U.S. income tax. The case, PPL Corporation et al. v. Commissioner, U.S. No. 12-43, was decided by the court on May 20, 2013.
Because the U.S. taxes its citizens, including corporations, on a worldwide basis, the Tax Code generally allows a deduction from gross income or a credit in the amount of foreign tax paid.
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