Category Archives: International taxation

Articles found here are more general in nature than in Cross Border. Here you will find proposed American Tax laws, Senate and Congressional hearings, comments on US Government official statements.
Cross Border is the advance sub category of International Taxation. Both are written by Brian Dooley, CPA, MBT.

Provocative International Tax Planning News for Small Business

International tax planning is going “crazy” with the 2018 GOP tax law.  International tax avoidance has never been more legal.  The tax savings have never been so Big!  It is time for you invest money with your international tax accountant and upgrade your plan.   

International tax planning and strategy

Applying for an IRS ruling on your international tax planning will save you taxes in the long run.

Fantastic IRS International Gift Tax Plan

This IRS internal letter on this link. Fantastic legal tax avoidance for the foreign person with family in the U.S. is explained in this letter. Alien’s estate tax exemption is only $60,000.

Amazing IRS Avoidance of  state income taxes  with this new IRS  designer  Nevada trust.  IRS tells how to use a Nevada trust to avoid state income taxes. Here’s what’s happeningon this link.   

New- Department of the Treasury letter to the U.K. tax authorities on U.S.  tax planning for UK and EU companiesHere is the letter from the U.S. to the U.K. 

Be an IRS tax planning wizard with our new custom Google search, on this link.  This custom search reads 300,000 pages deep inside the IRS’s website and the tax court’s website.  It is free!.  Find the answers to your tax question quickly and accurately.

18th Century Supreme Court case destroys IRS tax penalty law. Using this case, the Tax Court gave the IRS a significant 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  Supreme Court Doctrine used by the IRS to blow up an offshore life insurance plan.

offshore trust, foreign trust, nevada trust, estate planning trust, esbt,

Since the Middle Ages, the wealthy have capitalized on trusts to avoid paying taxes. During the Great Crusades, upon the death of a knight, his entire estate went to the king.    Nine hundred years later, things have not changed much except the ‘King” takes only half.

Trusts are the most efficient tax tool. International tax planning should start with a Nevada trust to own a  foreign company.  Learn trust tax planning and asset protection in this easy to read blog post.    It has the blueprint for successful trust tax planning.   Get the IRS memo on asset protection and tax planning with an offshore trust on this blog post.

internet tax planning, saving taxes, cloud tax planning

Saving taxes with the offshore cloud computer. 

Cloud tax planning. Learn how businesses are using the cloud to avoid taxes on this link. 

E-commerce companies are avoiding state income taxes and in some cases deferring U.S. taxes.

Here is how it works.  A computer service that can provide a service (such as a tax research program) or a product (such as music, e-books, video) has special sourcing rules.  The income can be foreign source income when the computer server in a foreign country. 

Is the U.S. a tax haven for citizens of the UK, Sweden, Belgium, Canada, Luxembourg, and Austria?  Yes, says the IRS in its Publication.  Learn the magic Tax Treaty words for these lucky citizens of The UK, Sweden, Belgium, Canada, Luxembourg, Austria on this link.

Saving International Taxes with Tax Treaty’s Tie Breaker Rules for the Green Card Holder

The tax treaty tie breaker rule can allow a green card holder not to be a U.S. tax resident. 

The tax treaty tie breaker rule overrides the U.S. tax code.  The tax treaty tie breaker rule requires an individual to be a resident of the country where he has the closest connection. 

With the tax treaty tie breaker rule a green card holder who is a citizen of a country with a tax treaty may non-resident for U.S. income taxes.  Tax treaties override the U.S. tax code.

As a non-tax resident, you live and work in the U.S. but only pay tax on your U.S. income and not your foreign income.

Here is what happens:  If you are a dual-resident taxpayer (a resident of both the United States and another country), a tax treaty’s “tie-breaker” rule determine if you are a U.S. income tax resident.   

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Best International Tax Attorney or International Tax Accountant

The best international tax attorney international tax accountant must know both the 1,000,000 pages domestic tax laws, the “common laws” from court cases and international tax law.   

The best international tax attorneys and accountants use the tax pyramid.

The best international tax attorney and tax accountant have an advance degree in taxation.

The best international tax attorney and tax accountant have an advance degree in taxation.

The best tax attorneys and best tax accountants are experts in both the common law and the tax code before they learn international tax law.

The best tax accountants and best tax attorneys have an advance degree in taxation.  Law schools and accounting schools do not teach tax law.  Up tp two additional years of schooling is required to be a tax expert.

The international tax adviser studies the “character of your income.  Each type of income has its own tax laws.

 The tax law for consulting income is different than the tax law for importing income.  The best international tax CPA looks at your business’s operations and dissects each step.

Here is an example:  A U.S.  website designer has employees in India.  After dissecting his activities, he decided to incorporate in a tax-free country.  The tax haven corporation files an IRS Form 1120F (F is for Foreign).  Only half of his net income is U.S. taxable. The other half is not taxable.  His business operates the same.

At International Tax Counselors, our international taxation experts have more than 30 years of experience.  Each expert has an advance degree in taxation.

If you need planning, consulting, or compliance, your team at International Tax Counselors has the needed international accounting and legal expertise and skills.

We have unique expertise in:

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International Tax CPA Prepares Form 1120F and Avoid the Branch Profits Tax

The International Tax CPA know that the branch profits tax is a sneaky beast.   It has three prongs.  One is your interest expense. Next, the amount of equity in your U.S. business,  Lastly, the reason you have equity in your U.S. business.  This tax is reported on Form 1120F.

If you kept equity in your U.S. business to avoid the branch profits tax, then you owe the branch profits tax.   Form 1120F’s balance sheet is where you study this topic.

The branch profits tax is designed after the domestic corporate tax law known as the “accumulated earnings and profits tax”.  This law is found in tax code section 531.  This key factor is the accumulation of profits to avoid paying a dividend (and thus the income tax on the dividend).

International Tax CPA and the Form 1120F

My course to the California Society of CPA’s on international tax planning included the branch profits tax.  Below is part of the course.   If you need help with your international tax planning, then contact me at [email protected]

This course was for the international tax CPA. So, you may find the video too complicated. I suggested that you forward this blog to your CPA  (if he is not an international tax CPA).

Here (this link) is more information on the branch profits tax.  The tax is tricky.

If you have paid the tax, then let us see if we can get the IRS to refund branch profits tax to you.  I can tell you one way to know if your CPA has messed up.

If your business does not have a double entry set of accounting books (called a general ledger), then the branch profits tax calculation may be wrong.

E-commerce and Mobile Commerce International Tax Planning for the Small Business

E-commerce and Mobile Commerce International Tax Planning  exists because our international tax laws were written by a man born in the 1860’s.  This is not a typo.  He grew up in the world of Pony Express and steamship commerce.

In the 1930’s he became the Chairman of the Congressional Tax Committee.  His view of commerce was the late 1800’s.  Congress has never changed our international tax laws.

These tax laws work just fine in the industrial age but  now these ancients laws create legitimate loopholes for e-commerce and cloud based businesses.

E-commerce and Mobile Commerce International Tax Planning for the Internet of Things.

We are in the age of “internet of things,” 

The  industrial age tax laws provide many unique tax savings for the e-commerce business, the contract manufacturing business, and the internet marketing business.

My easy to read book, International Taxation in America for the Entrepreneur, provides the tried and true blueprint for saving taxes for today’s E-commerce businesses.  I have the first three  chapters on this link.

The first three chapters are easy to read but are hard to believe.  I mean, is it really possible that Congress has done nothing about international tax laws since the Great Depression in the 1930s?

And there is more unbelievable events.  The designer of the tax law was born just after the Civil War.  His father served in the Confederate Army.   His parents named him after Confederate General Robert E. Lee.

And there is more.   The writer of our international tax law had only a high school education.  To him, text messaging was the telegraph.

So, get the first 25 pages, for free, of my popular book on international tax planning with an emphasis on e-commerce and cloud based products on this link.

Or buy the book at Amazon for $9.50, on this link.   By the way, Amazon has a seven day return policy.  So, if you don’t like the book, just send it back (which is easy to do as a Kindle book0

Now, if you want to take your international tax planning to the next lever, then contact me, Brian Dooley, CPA, MBT  at [email protected]

This link has another blog in saving taxes in the e-Commerce and virtual computer world.