Tax News

Last week, EU finance ministers met to discuss a Danish proposal that would expand the blacklist of tax haven countries.  Additionally, the proposal questioned if the current safeguards against tax avoidance and evasion are sufficient.  In the EU, this blacklist of deemed tax havens normally leads to difficulty in tax planning when doing business in […]

In the U.S., business entities are formed on a state level.  This means that the taxpayer must choose a state to setup the business.  Each state has unique rules for formation, corporate governance and tax.  Therefore, not only is this a decision that must be made, but it can be an important decision.  The options […]

Today I was listening to ESPN radio, two hosts were discussing an NFL team moving to London.  They said it would never happen because the player would have to pay the 45% maximum rate in England, as well as the 37% highest rate in the U.S., giving up roughly 82% of their income.  However, this […]

Prior to the Tax Cuts and Jobs Act, in order to qualify as a controlled foreign corporation (CFC), U.S. persons had to control the foreign corporation for an uninterrupted period of 30 days.  Classification as a CFC is very important because it requires certain informational reporting and subjects the taxpayer to tax rules such as […]

While we have not heard of any official policy from the IRS, we have been witnessing an unsettling trend.  In the past month we have had three clients who owed taxes received unexpected visits from the IRS.  This is despite being in constant contact with the IRS and having a power of attorney on file.  […]

There are several options for filing status when a U.S. person is married to a non-U.S. person.  First, the standard method is to file as married filing separately.  This is the easiest option as it does not require any election nor does it require your spouse have a U.S. tax identification number.  Next, there is […]

One of the biggest changes the 2017 Tax Cuts and Jobs Act (TCJA) enacted in the international tax arena was section 951A, also known as the Global Intangible Low-Taxed Income (GILTI). GILTI requires certain U.S. owners of foreign corporations to include in their personal income taxes the GILTI from the foreign corporation.  This reporting is […]

The GILTI laws apply to far more taxpayers than expected, require long detailed calculations, and after all that work could likely result in no tax.  However, the cost of ignoring the application, even if no tax is due, could come with very high penalties. Overview On the surface, the new GILTI (Global Intangible Low-Taxed Income) […]

In general, there are not any restrictions on foreigners owning U.S. businesses.  The corporation, LLC, or other business entity files its formation documents with the appropriate state government office in a very straightforward process.  Next, the entity must apply for a tax identification number known as an “EIN.” In the past, there was no problem […]

In general, foreign owned businesses are taxed to their U.S. owners as if they were setup in the U.S.  Therefore, it is very important to determine what the business would be considered for U.S. tax purposes.  In some circumstances, the taxpayer can make an election of how the entity will be taxed.  For various reasons, […]