Missouri Provides Guidance on Global Intangible Low-Taxed Income

Missouri provides guidance on how to report global intangible low-taxed income (GILTI) for Missouri tax purposes. The federal GILTI provision (IRC Sec. 951A) may affect Missouri taxes for both:

– corporate income taxpayers; and

– individual income taxpayers.


IRC Sec. 951A requires U.S. shareholders of any controlled foreign corporation to include its GILTI in gross income. IRC Sec. 250 allows a corporate taxpayers with GILTI to deduct part of that amount.

Starting Point

Missouri automatically includes IRC Sec. 951A income in:

– federal taxable income on Form MO-1120, Line 1; or

– federal adjusted gross income on Form MO-1040, Line 1.

Missouri also takes the IRC Sec. 250 GILTI deduction into account on Form MO-1120, Line 1. Individuals cannot take the GILTI deduction.

Dividends Deduction

Corporate taxpayers may be able to offset all or part of their net GILTI amount by claiming a dividends deduction. Missouri treats the net GILTI amount as if it was a dividend for tax purposes. Corporate taxpayers that apportion their income can subtract an apportioned share of the net GILTI amount that is business income through the Missouri dividends deduction. They may claim this deduction on Form MO-1120, Line 10. They can also deduct any amount that constitutes dividends from a non-Missouri payer. They may claim this deduction on Form MO-MS, Part 2, Line 12.

Nonbusiness Income

Corporate taxpayers also may be able to offset their net GILTI amount by reporting nonbusiness income. They should report any GILTI amount that is nonbusiness income on Forms MO-NBI and MO-MS, Part 1, Lines 9 or 12. They must provide a detailed description of:

– their business,

– the nonbusiness income; and

– why the income is nonbusiness income.

Failure to do so will result in disallowance of the reported nonbusiness income amount.

Consolidated Federal Return and Separate Missouri Returns

Taxpayers filing a consolidated federal return and separate Missouri returns must determine their net GILTI amount as if they filed separate federal returns. If a company had no ownership of its affiliated group’s controlled foreign corporation, it would have no net GILTI amount for Missouri purposes. If a company had all of its affiliated group’s ownership interest in the controlled foreign corporation, it would include the full net GILTI amount in its federal taxable income for Missouri purposes.

Policy Guidance, Tax Cuts and Jobs Act, IRC Section 951A Global Intangible Low-taxed Income (GILTI), Missouri Department of Revenue, February 2019, ¶204-221

Login to read more tax news on CCH® AnswerConnect or CCH® Intelliconnect®.

Not a subscriber? Sign up for a free trial or contact us for a representative.



All stories by: CCHTaxGroup