GILTI (Global Intangible Low-Taxed Income)

GILTI, or Global Intangible Low-Taxed Income, is a U.S. tax provision introduced by the Tax Cuts and Jobs Act of 2017. It targets profits that U.S. companies earn from foreign subsidiaries, especially those derived from intangible assets like patents and trademarks. The goal is to discourage companies from shifting profits to low-tax countries. Under GILTI, U.S. companies must pay a minimum tax on these earnings, ensuring they contribute to U.S. tax revenue, even if they’re generated overseas, while incentivizing investments in the U.S. rather than routing profits through tax havens.