A corporation's legal entity structure and the repatriation strategy that it adopts in order to finance new ventures, whether at home or abroad, can have a dramatic impact on its overall tax liability. Imagine having the power to consider hundreds of different dividend planning scenarios and understand immediately the impact of each scenario on cash tax, withholding tax impact, and utilization of FTCs. Or imagine having the power to—in a matter of minutes—measure the tax impact of an unlimited number of legal entity combinations, while taking into account all material data, business constraints, related tax rules, and filing options. Depending on the number of legal entities considered, this analysis could involve evaluating hundreds, or thousands of combinations—in fact, the number of permutations grows exponentially, and quickly reaches a level that is unfathomable. This level of modeling is simply impossible when tax professionals are armed only with traditional tools such as spreadsheets. Without advanced technology, a tax department is unable to truly identify the optimal structure or pricing plan.

Now Liquid Engines' Optimizers make this capability a reality.

Unmatched in the industry, ITx’s patent-pending optimizers are designed to address highly complex international tax management challenges. Merging tax intelligence and relevant corporate tax data with advanced mathematical and economic algorithms, the optimizers rapidly calculate the tax impact of thousands of potential alternatives and present the best solutions back to the user. In addition, the Liquid Engines’ International Tax Optimizers offer a wizard-driven interface that makes it easy for users to apply constraints based on current business considerations. Applying company-specific constraints, such as ranges for dividend amounts or restrictions on which entities are allowed to check the box, ensures that the optimizers will evaluate only the options that are implementable.

Armed with this unique technology, tax departments no longer have to invest months of work to reach what might be the correct answer. With ITx, identifying the optimal answer is not only possible, it can be determined in a matter of minutes or hours. Liquid Engines ITx includes the following breakthrough optimizers:

• Check-the-Box Optimizer—Determines the filing election configuration that optimizes FTC and maximizes U.S. cash tax.
• Repatriation Optimizer—Determines the cost of repatriation and the mix of low-tax and high-tax earnings that can be repatriated.

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