The mandatory deemed repatriation of foreign earnings pursuant to Code Section 965 resulted in large amounts of previously taxed income (“PTI”) for U.S. multinational corporations. Not all PTI that originated under the transition tax, however, was created equal. The allocation of deficits in certain foreign subsidiaries to shield the positive earnings in other foreign subsidiaries from inclusion gave rise to a particular type of PTI under section 965(b)(4). Per the literal statutory language, this “shielded PTI” does not obviously benefit from the basis increase that accompanies the PTI arising from “normal” subpart F inclusions. The presence or absence of accompanying basis can mean the critical difference between PTI that is freely distributable without triggering gain, and PTI—i.e., cash—that is essentially trapped.