§176 Payments with respect to employees of certain foreign corporations

Summary

A U.S. corporation can deduct money it pays or owes under an agreement made under section 3121(l) for services performed by U.S. citizens who work for its foreign subsidiary, but only for amounts not already paid to those employees. If the company later is repaid for any amount it previously deducted, the repayment must be reported as income in the year it is received.