Glossary · Entity & Business
Check-the-Box Election
The check-the-box election lets the owner of an eligible foreign entity choose how it is treated for US tax — as a corporation or as a disregarded/pass-through entity. It can simplify or worsen a US owner position depending on the facts.
Entity Classification Election (Form 8832)
In more detail
By filing Form 8832, an eligible entity such as a UK limited company can elect to be disregarded for US purposes, so its income flows directly onto the owner return rather than being taxed under the corporate/CFC rules. This can avoid GILTI complexity but creates other consequences — self-employment tax exposure, a deemed liquidation on election, and a 60-month lock-in. It is a powerful but double-edged tool that should be modelled before filing.
Does Check-the-Box Election apply to your situation?
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