Export Tax Benefits

Enacted in 1971, Domestic International Sales Corporation rules were successfully attacked in the World Court as an illegal export subsidy, causing the United States Congress to add in 1986 an interest charge to taxes deferred under the DISC rules. Effective in 1985 Congress also enacted the Foreign Sales Corporation provisions.

A series of World Court reversals involving the Foreign Sales Corporation and an attempted successor, the Extraterritorial Income Exclusion left the Interest Charge DISC as the sole export promotion program. IC-DISC benefits for a variety of technical reasons, are effectively limited to closely held US companies, but the benefits can be significant.

William Harwood has designed and administered IC-DISC programs since the mid 1990s and particularly since 2005 taking advantage of dividend tax preferences. His programs have generated single year, single entity commissions exceeding $10 million with resulting tax savings of over $2 million.
IC-DISC benefits are frequently enhanced through a detailed transaction by transaction analysis. Transaction by transaction programs developed by Harwood are custom applications designed to fit within the cost and SG&A reporting programs of the client to maximize the IC-DISC under each of thousands of export transactions.

Meeting the needs of individual companies sometimes calls for the more complex financing programs allowed by the Internal Revenue Code IC-DISC provisions. These programs allow the exporting company or group of companies to keep cash working in operations.

In addition to IC-DISC program design, and annual commission calculations, and finance planning, NEOITG provides full IC-DISC tax return and shareholder reporting.