Tag Archives: cloud computer tax planning

Saving Taxes in the E-commerce & the Cloud (Virtual) Computer World

cloud computer tax, tax planning, saving taxes, international tax planning,

E-commerce businesses are saving taxes with cloud computer tax planning.

E-commerce tax planning and Cloud tax planning uses unique tax laws.  As a result, saving taxes in this century’s cross-border business environment is easier than ever.  

Small businesses are saving taxes with eCommerce tax planning and cloud computer tax planning.  

The cloud has level the playing field between small business and big business.  Amazon is leading the way.

 Small businesses can benefit from cloud computer tax planning.  

Cloud tax planning allows big state and federal tax savings.  A popular term for this is “third wave” tax planning.  The second wave was most of last century and a little of the 1800s.  The first wave is from  10,000 BC to the late 1800s.  This explains the loophole.  Our tax laws were designed in the early 1900s.  While the laws are more complicated, the basis framework is unchanged.

We all have heard people say that things are not what they used to be.  This is particularly true in American business.  In 1910, electricity was not in the White House.  Cars were laughed at with jokes like “Get a horse!” 

Phones were rare, and there was no air travel.  U.S. E-commerce tax laws are written for last century’s business.  E-commerce tax planning provides significant tax savings.   Here is what has gone wrong for the Government and good for small business.

  Who is this man?    He is Robert Lee Doughton.   He was the powerful chairman of the U.S. Congressional committee that writes the tax laws.

This man designed and wrote our international tax laws. His education was only high school. His father fought with General Robert E. Lee (General of the Confederate States of America).  He was named after the General.  He was born in 1863. His view of international commerce was via steamship

In 1939, he wrote the international tax laws that govern today’s international taxation in America.[1]  Most of the congressional representatives who wrote the 1939 tax code were born before 1900.    Their view of the world was what you see in many silent movies … and so was their tax law.

Their idea of technology was steamships and the telegraph.  It is this world vision that governs how the U.S. taxes international business and investment today.

On this link, you can view my forty-minute of my presentation of the California Society of Certified Public Accountants on profiting from Congress’s failure to innovate.

Successful E-commerce international tax planning revolves around a major flaw in American tax law caused by the speed of change (more on this link).  

If you need to up the quality of your tax planning, then contact me, Brian Dooley, CPA, MBT, at [email protected]

[1] Congress renamed the tax code in 1986 to the “Internal Revenue Code of 1986.” As I wrote this, I realize that 1986 was just at the end the “second wave” of business. The tax consequences of leaving the economics of the second wave and moving into the economics of the third wave are discussed in this video.

 

International Tax Strategy Sale of Cloud Web Based Know-how by Offshore Corporations

As little as fifteen years ago, the topic of International Tax Strategy Sale of Cloud Web Based Know-how by Offshore Corporations did not exists.  Nor did the iPhone or iPad exists.

However, now,  the correct configuration and design of your e-commerce website will make or break you.  In the 1800s and 1900s, practical know-how was born.  Often placed in a manual, practical know-how is the method employees would accomplish their work.

Imagine Henry Ford and his “discovery” of the assembly line.  Having never existed before, he had to train his employees.  He had to learn about managers and supervisors and assembly workers.  What he learned and how it was utilized is practical know-how.

I supposed over the years, assembly manufacturing has changed.  If so, the practical know-how has changed (to learn international tax planning for practical know-how, please see this blog post).

And so it is with a great e-commerce or other website business.   We learn by our mistakes and then we re-work the website.  Or, new technology forces us to re-write the website if we want to stay competitive.

International Tax Strategy Sale of Cloud Web Based Know-how by Offshore Corporations

Know-how can be property for U.S. tax law.  I know this may sound boring or not important but the classification as property allows you to shift income offshore and to convert your income into long term capital gain.

Let me give you an example of this international tax strategy for the cloud based e-commerce business.  Jeff, is starting a shoe store to compete with Zappo.  Now, if you have bought a shoe from Zappo, you know that they have a great website and business.

Jeff must beat Zappo and to do so, he creates an amazing website.  The website does every that you would experience in a store.  Before Jeff started on his amazing website, he formed a foreign corporation to develop and own the website.

Jeff’s warehouse is in the U.S. as is his employees and banking.  The website is hosted in Canada.  Jeff pays his foreign corporation for its know-how.  He deducts the payment. Canada’s tax law does not tax the income earned  by the foriegn corporation.

International Tax Planning in 3 Minutes with this Entertaining Video

E-commerce and international tax planning. This book is an easy and quick two-hour read.

E-commerce business and cloud-based business have an easier tax strategy. Become an international tax pro with my easy to read (about 2 hours) book, International Taxation in America for the Entrepreneur, at Amazon (for $9.50) on this link.

Ancient IRS Regulation Creates New International Tax Savings for the Cloud Computer and the Internet business

cloud computer tax, tax planning, saving taxes, international tax planning, internet tax planning, eCommerce tax planning, virtual computer tax planning,

E-commerce businesses are saving taxes with cloud computer tax planning.

Thousands of small business are legally avoiding taxes by following an ancient IRS regulations.   If you sell a PDF file, an MP3 or a video that is downloaded, creating foreign income is easy because of this tax law the IRS wrote in the 1990s.  

Under this old law, when your website downloads the file, you are treated like an exported of property.  If title to the property taxes places outside of the United States, the income is foreign income.  Yep, it is just that simple.  Below is the technical stuff for your CPA.

Here is what’s happen: The 21st Century has a new paradigm in business.  We all use and love it. E-commerce, cloud computer, internet business or “i” business, we all enjoy streaming music, Netflix, shopping online, and Kindle book (by the way, please check out mine).
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Tax War Erupts in the UK Against American Cloud Commerce

Citizen of Crickhowell want American money

Crickhowell, Wales. Citizen of Crickhowell wants American money.

This is the second time in 150 years that quaint Britain has been devastated by American ingenuity.

The New York Times reported that Mr. Steven Lewis the owner of the Number 18 Cafe and Brasserie (located in Crickhowell, Wales) is paying tax at a 21% tax rate (versus the U.S. top rate of 44%).  I assume he uses Facebook (for free) because he knows the company very well.

He demands that Facebook pays taxes to the Crown.   The citizen of Crickhowell a demand that U.S  internet based firms pay more U.K.

International law (found in the Treaty between the U.S. and the U.K.) states that a U.S. firm that does not have a warehouse or factory in the U.K. is not subject to U.K. tax (the same rule applies to a U.K business in the U.S.).  To avoid double taxation, the Treaty requires the IRS to refund to American taxes paid to the U.K. The tax Mr. Lewis wants is paid by us, the American taxpayer.

Back to Mr. Lewis and his cafe.  If an American ate in his Cafe, would he expect to pay taxes to the IRS?  Of course not.  The source of the income is his cafe.  The source of internet income is the place of broadcasting.

But here is the problem.  The U.K. is quaint.    Charming equals obsolete.  Wales, England, and Scotland have no internet business that broadcast to the United States.

In 1870, as the industrial age came to Britain, American farmers created a seventy-year depression (see Agriculture in Depression 1870-1940 (New Studies in Economic and Social History) by Richard Perren) in the U.K.  Steamships from American were shipping refrigerated beef and dairy products to the U.K, devastating the U.K. farmer.

This Century,  American businesses are broadcasting internet services to the U.K.   The United Kingdom and the European nations envy of American innovation has turned to resentment.  Like Robin Hood,  Mr. Steven Lewis wants to take from the rich ( Americans) and give to the poor (Britain and in presumably, he will have a lower tax rate).

The internet allows every small business to be an international trade.

Small business owners are learning the tried and true strategies of e-commerce tax planning, cloud tax planning and internet business tax planning the 2016 edition of my book International Taxation in America for the Entrepreneur on this link at Amazon.  It is the only international tax planning book with the blueprint for e-commerce and internet business tax plans.

If you need to up the quality of your tax planning, then contact me, Brian Dooley, CPA, MBT, at [email protected]