Logo Corporation, a domestic corporation, owns 100%of TAG, a foreign corporation. TAG is Logos only source of

Question:

Logo Corporation, a domestic corporation, owns 100%of TAG, a foreign corporation. TAG is Logo’s only source of income. During the current year, TAG receives $80,000 of dividends and interest from its foreign investments. TAG pays $6,000 in foreign taxes and does not distribute any income to Logo during the year. Write a memo to Logo discussing the implications of its ownership of TAG.