§00Structure · Glossary
U.S. Blocker Corporation
A U.S. corporation interposed between foreign investors and a flow-through U.S. entity to absorb ECI.
In full
A U.S. blocker corporation absorbs Effectively Connected Income at the corporate level so that foreign investors receive dividends — withheld at whatever rate the applicable treaty and the investor's facts produce — rather than flow-through ECI. Used heavily by private equity, venture capital, and family offices to give foreign LPs access to U.S. operating company exposure without direct ECI reporting obligations.
This definition is general information about how the term is used in U.S. cross-border tax. It is not advice, and how it applies depends on your own facts and on the treaty, if any, in force with your country.