The base erosion and anti-abuse tax known by the acronym "BEAT"was enacted by the Tax Cuts and Jobs Act (TCJA) as a means oflimiting intercompany funds flowing out of the United States. Forcompanies that meet certain criteria, the BEAT acts as analternative minimum tax, with the potential for the additional taxpayable to be significant. As such, the BEAT continues to be asignificant area of focus for multinationals with U.S. operations,particularly large multinationals with material U.S.-outboundintercompany flows.

Effective management of BEAT exposures is highly specific to thefacts and circumstances of each multinational and requires thoseimpacted to perform critical reviews of operations and supportingstructures that result in material funds flows. Many intercompanyflows that touch the corporate treasury group appear relevant;these could include interest on loans, lease-financing payments,guarantee fees, and service payments to non-U.S. treasurycenters.