The CRA does not consider a US limited liability company (LLC) itself to be a resident of the US for purposes of benefits under the Canada-US tax treaty (Treaty). However, pursuant to Article IV(6) of the Treaty, the CRA will permit an LLC to claim benefits under the Treaty on behalf of a member of the LLC – provided the member is a US resident qualifying for benefits under the Treaty. In 2012-0440101E5, the CRA confirmed that this “look-through” treatment for LLCs also applies for the 5% Canadian branch tax rate in Article X(6) of the Treaty, but only in respect of corporate members of the LLC. No provision of the Treaty otherwise reduces the 25% Canadian branch tax imposed on that portion of the LLC’s Canadian branch profits considered to be derived by individual members (under the look-through rule). The CRA further commented that an LLC has only one $500,000 cumulative branch profits exemption under Article X(6). That is, once the LLC’s entire cumulative earnings attributable to a permanent establishment in Canada (less the permitted amounts in Article X(6)) exceed $500,000, the LLC’s corporate members cease to qualify for a branch tax exemption and are subject to the 5% branch tax rate.