Bluebirds deemed paid foreign tax credit

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Reference no: EM13121092

Bluebird, Inc., a domestic corporation, has worldwide taxable income of $8 million, including a $900,000 dividend from ForCo, a wholly-owned foreign corporation. ForCo's post-1986 undistributed E & P are $18 million and it has paid $12 million of foreign income taxes attributable to these earnings. What is Bluebird's deemed paid foreign tax credit related to the dividend received (before consideration of any limitation)?

a. $0.

b. $600,000.

c. $900,000.

d. $12 million

e. Some other amount.

Reference no: EM13121092

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