IC-DISC: Who Qualifies?
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Karen: This is PKF Texas Entrepreneur's Playbook and I'm Karen Love, Host and Co-founder. Today I'm here with Frank Landreneau, one of our International Tax Directors, so we'd like to welcome you back to the Playbook.
Frank: Thank you, great to be here again.
Karen: Thank you, and last time you mentioned about the IC-DISC and I was wondering, can anyone set up an IC-DISC.
Frank: Well technically, but not everybody can qualify. Usually IC-DISC benefits manufacturers and distributors who sell tangible personal property such as inventory, primarily targeted for export.
Karen: Okay, so the type of company manufacturing and distributors, anything else about that or the timing of when they need to do this?
Frank: The interesting part of it is that the goods primarily have to be manufactured in the U.S., so those manufacturers that have a lot of foreign content typically may not qualify. With regard to the timing, the sooner the better; the IC-DISC is a special purpose vehicle and the tax benefits are only derived while the IC-DISC is in place.
Karen: Wow. Now this is very complicated for a layperson so I'm going to ask that you come back and explain in detail how this is done if you don't mind doing that.
Frank: Perfect, I'd love to do that.
Karen: Fantastic, thank you. So we're going to talk more next week about the IC-DISC and for other international topics visit PKFTexas.com/internationaldesk. And this has been another Thought Leader Production brought to you by PKF Texas Entrepreneur's Playbook.