USCo, a C corporation, owns FORco, a foreign corporation. On December 31, 2017, FORco has $5 million of earnings and profits, $2 million of which are attributable to cash or cash equivalents. What is the amount of the transition tax (a/k/a Deemed Repatriation Regime)?

Question 22 options:

1)

$0.

2)

$400,000.

3)

$775,000.

4)

$550,000.