Portfolio Interest Exemption Screener

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To repatriate cash from a U.S. Blocker without paying a 30% dividend withholding tax, investors use shareholder debt. If structured correctly, the interest paid back to the foreign investor qualifies for the Portfolio Interest Exemption and is not subject to U.S. withholding tax.

1. Does the foreign lender own 10% or more of the voting stock of the U.S. borrowing corporation? The '10% Shareholder Rule' applies heavily via attribution (family/related entities).

2. Is the debt in registered form (or foreign-targeted bearer form)?

3. Is the interest contingent on the borrower's profits, cash flow, or asset appreciation?