2026 international tax planning guide

International tax planning priorities in a changing global landscape

Effective international tax planning goes beyond reacting to tax law changes. Rather, it involves proactively seeking to understand how your global business decisions affect your company's overall tax profile. New U.S. international tax rules, Organisation for Economic Co-operation and Development (OECD) Pillar Two implementation, supply chain shifts and financing pressures are creating planning opportunities and risks that vary significantly from one company to another. The most successful organizations are involving tax advisors well before decisions are finalized, so they can evaluate financial reporting, cash tax, compliance and operational implications together.

RSM has identified five tax matters that should be top of mind for U.S. multinationals dealing with U.S. international tax reform, transfer pricing strategy, Pillar Two implementation, supply chain changes and financing pressures.

Companies are reevaluating supply chains, manufacturing footprints, market expansion plans and workforce locations in response to tariffs, changing trade policies and broader business pressures. What often begins as an operational decision can quickly create tax consequences across multiple jurisdictions. Bringing tax into the discussion early can help you identify hidden costs, avoid unintended compliance obligations and evaluate alternative operating models before a strategy is finalized.

Changes to sourcing, manufacturing, distribution channels or legal entity structures can affect transfer pricing, customs duties, withholding taxes, value-added tax (VAT), foreign tax credits (FTCs), cash repatriation strategies and global reporting obligations. As you expand into new markets or redesign supply chains, tax considerations increasingly intersect with finance, operations and treasury decisions. More organizations are evaluating multiple operating scenarios before implementation to understand both business and tax outcomes.

By the time operational decisions are made, you may have limited flexibility to address inefficient structures, unexpected indirect tax costs or cross-border reporting challenges. Organizations that assess tax implications during the planning phase can better align their operating model, supply chain and global footprint with long-term business objectives.

Current trade and tariff developments are adding urgency to these discussions. Tariffs can influence sourcing decisions, alter transfer pricing economics and affect overall profitability.

By calling on your tax advisor to help model tax, tariff and operational impacts together, you may be better positioned to evaluate alternatives, understand total landed costs and build more resilient global operating structures.

Recent changes to the U.S. international tax framework—including updates to net controlled foreign corporation tested income (NCTI), foreign-derived deduction-eligible income (FDDEI), section 250 deductions and FTC rules—can influence cash taxes, effective tax rates, tax provisions and future business decisions. Congress is already looking ahead to further changes, as indicated by a late-summer proposal package introduced before the midterm recess.

What makes these changes challenging is that they do not operate independently. A change that appears unfavorable in isolation may be offset by changes elsewhere in the tax system. Likewise, a seemingly minor adjustment can have broader implications when combined with FTC limitations, expense allocation rules or cross-border operating structures.

Tax modeling to account for a company’s particular facts and circumstances can show how the interaction of these rules produces results that differ significantly from initial expectations.

For example, companies anticipating higher U.S. tax liabilities because of reduced section 250 deduction rates may discover that favorable changes to FTC calculations offset much of the impact. Others expecting reduced benefits from foreign-derived intangible income changes have found that revised expense allocation rules increased the amount of income eligible for preferential treatment. Capital-intensive businesses have also discovered that the elimination of certain tangible asset-based exclusions can affect their tax profile more significantly than expected.

In short, there is no universal outcome in international tax. Two companies operating in the same industry can experience very different results depending on their legal structure, foreign tax profile, supply chain and cash flow needs.

International tax modeling can help you evaluate outcomes in the following areas:

• Cash tax obligations and quarterly estimated payments
• Effective tax rate forecasts
• Tax provision implications under Accounting Standards Codification (ASC) Topic 740
• Deferred tax assets and liabilities
• FTC utilization
• Cross-border cash planning
• Supply chain and operating model decisions
• Intellectual property ownership and licensing structures

A tax advisor can help model the combined effects of NCTI, FDDEI, section 250 deductions and FTCs to identify risks, uncover planning opportunities and support more informed business decisions. In an environment where the rules are changing rapidly and outcomes vary widely by taxpayer, fact-specific analysis remains the most reliable way to understand what international tax reform means for your organization.

Transfer pricing remains one of the most important planning tools available after companies understand the results of tax reform modeling. Advisors are seeing increased interest in using transfer pricing to manage effective tax rates, support FTC planning and respond to changing business operations. Transfer pricing can also support broader treasury objectives, including cash repatriation and global tax rate management.

Many companies have changed significantly over the past several years through acquisitions, digital transformation initiatives, supply chain redesigns, workforce changes and global expansion. However, their transfer pricing policies often remain largely unchanged.

On the administrative end, tax authorities continue to challenge transfer pricing positions, often focusing on whether documented policies reflect operational reality. As global transparency and reporting requirements increase, companies are expected to demonstrate that transfer pricing outcomes align with the functions performed, risks assumed and value created across the enterprise. Companies that have not updated policies as their business evolves face greater scrutiny.

In many cases, the greatest risk is not the policy itself but the gap between documented policies and operational reality. Tax authorities are paying closer attention to that disconnect, particularly as they gain access to more data through global reporting and information-sharing initiatives.

Transfer pricing should not be viewed as a once-a-year documentation exercise. Companies that periodically reassess their transfer pricing policies are often better positioned to support effective tax rate objectives, respond to business changes and defend their positions during examinations. A review with your tax advisor can help determine whether your intercompany pricing, operational processes and business realities remain aligned.

For many multinational enterprises, the Pillar Two conversation has moved beyond estimating historical exposure into a more practical phase: determining current compliance obligations, financial reporting impacts and readiness for future filings. Although the United States has not adopted Pillar Two, multinational groups may still face obligations in jurisdictions that have done so, including qualified domestic minimum top-up taxes (QDMTTs), income inclusion rules (IIRs) and undertaxed profits rules (UTPRs).

Increasingly, organizations are focused on tax provision impacts, data collection processes, governance frameworks and technology readiness rather than modeling alone.

Companies with consolidated revenue of at least 750 million euros in two of the prior four years should consider engaging tax advisors to assist with the following preparations:

• Inventory jurisdictions that have adopted QDMTTs, IIRs or UTPRs and identify local filing requirements.
• Evaluate tax provision and ASC 740 implications, including potential top-up tax accruals and disclosures.
• Assess the readiness of data, systems, controls and governance processes required for Global Anti-Base Erosion(GloBE) calculations and information returns.
• Develop a compliance roadmap that addresses reporting, technology and ongoing monitoring of legislative developments.

Many multinational companies are taking a fresh look at cash held by foreign subsidiaries before pursuing external borrowing or refinancing activities. In some cases, organizations have significant cash resources already available within their global structure but have not fully evaluated whether those funds can be deployed more efficiently.

In assessing repatriation strategies, intercompany lending arrangements, debt repayment opportunities and alternative funding structures, companies increasingly want to understand where cash can be moved, how it can be accessed, what local restrictions may apply and what tax consequences could arise from dividends, loans or other funding arrangements.

Cross-border cash planning also intersects with transfer pricing, withholding taxes, FTCs, legal entity structures and evolving international tax rules. As a result, organizations are increasingly evaluating cash mobility as part of broader treasury, tax and business planning discussions.

Evaluating cross-border cash positions proactively may help you identify opportunities to improve liquidity, reduce financing costs, support strategic investments and better align treasury and tax objectives. Working with a tax advisor who can help you understand the tax implications before moving funds can help avoid unintended costs and preserve flexibility for future business decisions.

Tax advisors can help untangle global obligations

In all these areas, international tax considerations are increasingly intertwined with business decisions. Whether you are responding to tax reform, reevaluating transfer pricing, preparing for Pillar Two, changing your operating model or accessing foreign cash, the greatest value often comes from involving tax advisors before decisions are finalized. The earlier tax enters the conversation, the more flexibility you have to evaluate alternatives, manage risk and avoid unintended consequences.

Frequently asked questions