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Provocative International Tax News

international tax, international tax planning,

International Tax Planning for the Entrepreneur is easy to read and understand.

You are in good company reading this blog with 50,000 other smart viewers  (from more than fifty countries).

Making you wealthy with innovative tax planning is the mission of this blog. Wealth is not created by your tax deductions. Spending a dollar to save forty cents in taxes will not make you wealthy. Wealth is created by good business including innovative and, in some cases, provocative tax plans.

Get my 2014 edition of International Taxation in America for the Entrepreneur at Amazon.  You will learn the tried and true methods of international tax planning for the business owner and real estate investor.  The Kindle is only $9.50 on this link.

Want to brainstorm your tax idea?   Then, please call me, Brian Dooley, CPA, MBT at 949-939-3414 for a free brainstorming consultation.

id theft, identity theft IRS refund, IRS refund, brian dooley,

Tax planning and saving taxes does not work when you IRS deposits are stolen. Use the “Safe Lock” to protect yourself.

Protect your tax refund from ID thieves with the free “Safe Lockon this link.  Until the Obama’s Attorney General Holder was robbed twice, the Administration did little.  Then they got Michelle’s Obama’s social security number.

Local drug gangs have turned into tax refunds thieves.   60 Minutes reported that they have “laptop parties” where they get together and chit chat as they steel your money.   Often they have a friend or a mole working at a doctors office. The mole gets your information.

If you are a victim and the IRS has frozen your refund,  call your Congressman.   He or she has a dedicated staff that works with the IRS.

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American firms are finding England a great low tax haven.  Pfizer Pharmaceutical move to London, has let the “cat out of the bag.” Here is how it is done if you are a small business.  If you are going to invert your headquarters outside the U.S., do it quickly.  Congress is panic and plans to have an “exit tax” (just like the Soviets back in the hey days of the USSR).

Tax Court gives the  blueprint on saving taxes on your investment income with your tax haven company.  You got to read about this case if you have investment income, on this link.

saving taxes, how to save taxes, tax planning,

i Saving taxes with an IRS approved tax plan is called a private letter ruling.

New IRS internal legal memo gives tax breaks to the “check the box” foreign company incurring losses.  Here are the tax saving IRS rules.

  • Avoiding state income taxes this new IRS  designer  Nevada trust.  IRS tells how to use your Nevada corporation as your trustee to legally stop paying state taxes on your investment income. Here’s what’s happeningon this link.

IRS blazes provocative tax savings for the foreign investor in U.S. real estate, on this link.

New 2014 IRS discloses the best business structure for the entrepreneur.  Designed to allow you to pay less taxes now and to get the best refund during the next recession.  Here is what is happening.

Tax planning,  with the Supreme Court common tax laws

Tax planning with Supreme Court common tax laws

18th Century Supreme Court case destroys IRS tax penalty law. Using this case, the Tax Court gave the IRS a big defeat.  Here is what happen.   The Supreme Court is the “law of the Land”.  It rules over the IRS and Congress.   

It works both ways.  The blog on this link explains the most missed Supreme Court Doctrine in this offshore plan blown away by the IRS.

international tax planning, international, tax, planning,

International tax planning and international tax savings with this Treasury Department report.

The U.S. Department of the Treasury (a branch of the White House) issued an report on tax savings international tax plans that the IRS cannot stop.   They reported the successful foreign tax plans of international businesses. We have obtain a copy.  It is on this link.  

If you have a business in a foreign country, this report will save your taxes.  The international income tax planning strategies in this Government report are the trade secrets of offshore tax planners.   

offshore trust, foreign trust, nevada trust, estate planning trust, esbt, Since the Middle Ages, the wealthy have capitalized on trusts to avoid paying taxes.

Trust are the most effective tax tool. International tax planning should start with a Nevada trust to own the foreign company.

This easy to read blog post has the blueprint for successful trust tax planning. International Tax Planning should start with a trust to own the foreign companies. Besides avoiding state income taxes, the trust can move onshore or offshore at any time.   Surprisingly, an internal IRS memo disclosures how to protect assets and save taxes with an offshore trust.  In this blog post, I discuss offshore tax planning and provide the IRS memo. 

internet tax planning, saving taxes, cloud tax planning ,

Saving taxes with the cloud based

Learn how businesses are using the cloud to save taxes on this link.  E-commerce businesses are avoiding state income taxes and in some cases deferring U.S. taxes.

Be an IRS tax wizard with our new custom Google search, below .  I personally programmed this custom Google app to read 500,000 pages deep inside the IRS’s web site and the tax court’s web site. 

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Offshore Tax Planning for IPad and Tablet Apps Developers

App developers have a unique advantage due to an ancient IRS law written by men (no woman allowed back then) who rejected technology.  E-commerce and cloud base business are saving taxes by hosting their sever in a foreign country.

This blog will discuss offshore tax planning for IPad and tablets apps. 

When I decided to write this blog,   I contact IRS international via an email.  I have their response below in blue.

  • Today at 10:15 AM   To  brian.dooley@yahoo.com

NOTE: Thank you for your inquiry.  Our response to your tax law question appears below. I hope this information has been helpful.    If you have a follow-up question or another general tax law question, please return to our web site at: www.irs.gov.

Please do not use your “reply” button to respond to this message.  More helpful information is provided at the end of this message.
        
For privacy and security purposes, your incoming e-mail text has been deleted in this response because it either asked a tax account question, which we do not answer (we answer tax law issues only), or it contained personal identification information.     

The Answer To Your Question Is:
Thank you for your inquiry dated October 7, 2014 in regards to determining source rules for intangible property.   

The term “sourcing of income “refers to where income is treated as earned for purposes of the IRS tax code. 

Research may be required by you to characterize transactions involving intangible property as a license rather than a sale. 

Unfortunately though, we can only offer our sincere apology that we will not be able to respond to your issue because it is too complex for the intent of this free tax assistance program. The IRS tax law service is intended to work in partnership with the professional tax preparation community.

 Thus, we refer taxpayers to that resource when their questions involve complex issues and situations. You may have to seek the services of a tax attorney, certified public accountant (CPA), Enrolled Agent (EA) or other tax professional.

Therefore, you can find assistance in checking the sourcing requirements under Sections 861 through 865 of the Internal Revenue Code and their related regulations, plus relevant court cases. 

You may want to get an official ruling by the IRS on this subject, such as a “Private Letter Ruling “ if so,  you can follow the instructions provided in Revenue Procedure 2014-1, which is available at most IRS offices and in some libraries.  

We are sorry for any inconvenience this may cause you, but thank you for using our electronic services.   

 The law is too complex  for the IRS because late last century,  the IRS boldly tackled the issue by writing  a new law on  software sales.   The project began in the early 1990’s.  The regulations covered the tax treatment of transactions involving the transfer of computer programs.

The  regulations provide rules for classifying such transactions as sales or  licenses of copyright rights, sales or leases of copyrighted articles, or  the provision of services, or of know-how.  The law was designed by attorneys that were living in the 1980s.  This ancient law provides unique tax saving opportunities.

For tablet apps, we are concern with what that IRS calls a “copyrighted article.”

An easy example, is a CD of music.  As you will read, the IRS regulation envisions a copyrighted article as tangible (touchable) personal property and not intangible property.  Thus, the IRS sees a musical CD the same as a MP3 file.

 Today, few of us would think of music as something you can touch.  Yet, the IRS attorneys that wrote this tax law grew up in the age of vinyl records and computer software on floppy disks and diskettes.   His past created a law that in this century does not make sense.  It this flaw that makes the law “complex“.

In this blog you will learn how that flaw will save you taxes.

The differences in tax law regarding tangible and intangible property (both domestic and offshore) are enormous.   For example, the IRS stated:
Generally, under the current rules, the source of income from sales of property depends to varying extents upon both the type of property and, for inventory property, the place of sale, with the place of sale generally determined by the place where title to the property passes. See section 1.861-7(c).

This means that the sale of your app, may be  U.S. tax free foreign source income if the place of sale is outside of the U.S.  The IRS goes on to explain how with the following:

As to the issue of determining the place of sale under the  title passage rule of section 1.861-7(c), the parties in many cases can  agree on where title passes for sales of inventory property generally.  Consistent with the overall policy of the regulations, income from  electronic transfers of computer programs that constitute inventory  property, classified as sales of copyrighted articles, will be sourced  under similar principles (underlining added by your author).

Lastly, you want the sale of your app to be a sale for tax law (and not rent or a license).  Here the IRS helps you by stating in a private letter ruling (which you should get for your tax planning):  Therefore, for example, a transaction that is  characterized by the parties as a “license” can be treated as a sale of a  copyrighted article if there is a transfer of a computer program on a single disk for a one-time payment with restrictions on transfer and reverse engineering. See section 1.861-18(h), Example 1.[1]
[1] IRS PLR 200229030  issued on 4/17/2002

The ideal tax plan is form a foreign corporation when you start to create your app.  If you have always stated, then form the foreign corporation as soon as possible (be sure you hire an attorney for this).  Next, have you CPA guide you on the necessary steps to have your foreign corporation the owner of your app for tax purposes.  Work with your attorney to have the place of title passage of the sale of the app in outside the U.S.

When you app is read for sale, host the app and the e-commerce on a computer located outside of the U.S.  Have you attorney draft the sale contracted hosted on your website that has the title pass outside of the U.S. 

Need some brainstorming?  Then call me, Brian Dooley, CPA, MBT at 949-939-3414 for a free one hour brainstorming consultation.