GILTI HIGH-TAX EXCLUSION ELECTION FOR US INDIVIDUAL TAXPAYERS

I'm hoping that one of the tax experts on the forum may be able to help me here -quite technical, sp please excuse me in advance!

I have a small family company (UKLtd) - it's a CFC and has 3 shareholders (all family members and USC's). Having completed form 5471 (and all it's schedules) and now form 8992 (U.S. Shareholder Calculation of Global Intangible Low-Taxed Income (GILTI)) I've generated a small GILTI (circa $15k for the largest 80% shareholder) in Part II line 5 of this form. Having now done further research I believe that I can elect to exclude this GILTI completely (and not transfer it to my 1040 via schedule 1) due to the UK having a higher corporate tax rate than the US (hopefully I'm not out of my depth here!).

Can anyone offer any advice or examples on the form (i.e. wording) of the election required. I don't want to over complicate things - hopefully the wording can be realtively simple.

Any input gratefully appreciated.

You need to perform the calculation.  The first question is whether your UK Ltd company regularly computes its income on an accrual basis.  If it doesn’t accrue expenses, then it may be on the cash method of accounting.

Another question is for what period does your UK Ltd company compute its income for UK tax purposes?  Does it compute its income on a calendar year basis?