Deemed repatriation from foreign corporations

When it comes to tax reform, most individuals aren’t worried because they have most of the year to plan (at least get an idea of what they may owe in 2019), but that is not true. The Tax Cuts and Jobs Act (“TCJA”) mostly affects tax years starting after 12-31-2017; HOWEVER, there is a small …

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Foreign-derived intangible income – tax reform impact

One good provision out of the new tax reform bill or Tax Cuts and Job Act (TCJA pronounced Tic-Ja) is the foreign derived intangible income or FDII. This provides domestic corporations with reduced rates of U.S. tax on their FDII. FDII is the domestic corporation’s portion of its intangible income, determined on a formulaic basis …

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New U.S. territorial tax system – tax reform impact

One of the major changes under the Tax Cuts and Jobs Act is the shift to a more territorial tax system. While most of the world is already on a territorial tax system, the United States has been doing its own thing taxing U.S. corporations on their worldwide income. Under the previous law, the U.S. …

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Will you be battling in the international tax arena in 2018?

If you answered yes to this question, then this blog may be for you! Whether you are a seasoned warrior or a new comer in the International Tax Arena, you want to know your opponent’s weaknesses and strengths, in order to plan and come out VICTORIOUS!!! Close your eyes; can you hear that? Is it …

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What’s new with 2017 Form 1042-S

Another year means more updates to Form 1042-S as the IRS attempts to have these forms work more efficiently and adapt to the ever changing tax laws. Here is what’s new for 2017: Unique form identifier: Each 1042-S form will now need to have a unique form identifier. This is different than a U.S. or …

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Favorable rulings do happen in international tax

I’m sure you all stay updated on your international tax court cases… oh wait, you don’t? That’s weird. The tax court recently ruled in favor of a company known as Grecian Magnesite Mining. Court Case: Grecian Magnesite Mining v. Commissioner, 149 T.C. 3 (2017). To give you a brief synopsis, Grecian Magnesite Mining (referred to …

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Foreign earned income exclusion & retirement savings

Do you think your accountant asks you too many questions? Do you feel interrogated? I’d just like to remind you that we are on your side and we aren’t the ones issuing penalties. We are here to help prevent those penalties, but we can only use the information that is given to us (shocking, I …

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Potential AMT risk for foreigners selling U.S. real estate

As the U.S. housing market continues to improve, many property owners are able to take advantage of the increase in property values and higher asking prices when they decide to sell. As such, sellers need to be aware of the tax implications when selling a home. Nonresident aliens especially need to be aware of their …

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VAT responsibility for U.S. companies selling to U.K.

The U.S. is one of few countries without a VAT system. By way of background, and in overly simplistic terms, it’s assessed on all goods and services. In most European countries the rate hovers around 18-20%. Generally speaking, U.K. companies will collect it on sales, pay it on purchases and submit the difference to the …

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Updated regulations on IRC Sections 987 and 988

On December 7, 2016, the IRS released temporary regulations under IRC Sections 987 and 988, which provide guidance on recognizing foreign income or loss as well as currency gain or loss from a qualified business unit (QBU). The original proposed regulations (regs) were issued back in 1991. In 2006, the 1991 proposed regs were replaced …

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