IC-DISC Export Incentive
The Interest Charge - Domestic International Sales Corporation (or IC-DISC) is an old and almost forgotten export incentive regime that dates back to the 1970s. However, almost all US exporters may benefit from operating with an IC-DISC structure. In addition, companies can take advantage of this potential tax savings with little to no disruption in how they currently operate their business.
Broadly, the IC-DISC involves internal accounting and tracking of foreign sales and profitability, in addition to some movement of funds among the organization and its shareholders. Establishing an IC-DISC can also be fairly straightforward and completed with relatively minimal start-up and ongoing costs, providing a potentially quick return on investment.
Note that the use of an IC-DISC structure is not a listed or reportable transaction, nor is it considered a "tax shelter." It is actually one of the last in a long history of Congressionally provided export incentives afforded to US companies for producing here in the US and exporting products abroad.
To learn more about this export incentive, contact Kyle Podd.