U.S. Innovation and Global Competitiveness Act of 2026

H.R. 10431, titled the U.S. Innovation and Global Competitiveness Act of 2026, changes several rules in the Internal Revenue Code regarding the taxation of international entities. It modifies deductions for foreign-derived intangible income and net controlled foreign corporation tested income, changes the base erosion minimum tax, and alters foreign tax credit limitation baskets. The bill also adjusts the carryover of net controlled foreign corporation tested losses, repeals certain foreign tax credit haircuts, and applies foreign-source dividend deductions to controlled foreign corporations. Additionally, it eliminates the inclusion of specific foreign base company income, exempts certain corporations from subpart F inclusions for United States property investments, and sets special rules for transfers of intangible property. Finally, it addresses services performed in the United States Virgin Islands, repeals a business interest limitation modification, treats the research credit as a specified credit for all taxpayers, and requires regulations to prevent duplicative charges for research and development expenditures.