Tag Archives: international tax planning

Provocative International Tax News

offshore tax planning, offshore tax strategies, controlled foreign corporation,

Tax Planning Small Business Are Taxed at 14%

Government Report Shames Businesses Paying More than 14% in Taxes.    Difficult to believe that Senator Bernie Sanders  (who paid tax at 13%) released the report.  It states that business that plan their taxes are taxed at 14%. Here’s what’s going on.   

Small Business Tax Planning. Try very hard to pay the least in taxes

Small Business Tax Planning. President Trump states that he try very hard to pay the least in taxes

Meanwhile, after the defeat of the Health Care Reform,  the Trump Tax Reform is looking at an August vote.   Keep up to date on this link.    As in the case of President Trump,  we all have to work hard to pay the least in taxes.   Tax savings is not as simple as a year-end call to your CPA.    On this link, you will learn how to get your tax rate down to 14%.

International tax planning for the Contract Manufactuere

International tax planning for the Contract Manufacturer

Amazing tax savings for importers of contracted manufacturer of their products.  This new IRS law gives tax savings to small businesses.  Learn more on this link and send it to your CPA.
For additional small business tax savings get my book International Taxation in America for the Entrepreneur on sale for $9.50 on this link.

 

Small businesses are now reaping big tax savings.  Importers, exporters, and e-commerce business can use the same loopholes as big business. I wrote my book to teach you these tried and true strategies in an easy two-hour read.

International tax planning

Buy at Amazon for only $9.50.

But, I did more.  I had an audiobook created.  It downloads onto your smartphone so that you can listen while you are commuting.   Get the 2017 edition of  International Taxation in America for the Entrepreneur for $9.50 at Amazon on this link.

 

saving taxes, how to save taxes, tax planning,

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

International Gift Tax Plans with 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.

  • 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.

New- Saving international taxes with this letter from the U.S. Department of the Treasury letter to the U.K. tax authorities on tax planning in the U.S. for UK and EU companies.

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 use by the IRS to blow up this offshore plan.

international tax planning, international, tax, planning,

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

The secret report on tax savings international tax plans that the IRS cannot stop was issued by the U.S. Department of the Treasury (a branch of the White House).

They reported the successful foreign tax plans of international businesses. We have obtained a copy.  It is on this link.   Here you will learn the legitimate foreign tax plans that Congress likes. 

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.

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

internet tax planning, saving taxes, cloud tax planning

Saving taxes with the cloud-based

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

Be an IRS tax wizard with our new custom Google search, on this link.  This custom Google app to read 400,000 pages deep inside the IRS’s website and the tax court’s website.

How the IRS Taxes Australian, Candadian, U.K. and Europeans Companies and Citizens Doing Business In The United States

french tax, french tax planning, job loss.

French businesses are profiting by avoiding the VAT by manufacturing in the U.S.

This blog is for Australian, Canadain, U.K. and Western European companies and citizens planning to have a business in the U.S. or business income from U.S. customers.

The United States is courting U.K., Western European, Canadian and Australian citizens to move their businesses.  The U.S. doesn’t  have a VAT (value-added tax).  The absence of this tax gives a 25% increase in a company’s purchasing power (assuming a VAT of 20%) of inventory, machinery and employees.  Business makes more money due to the additional working capital.   

Labor unions are weak in the U.S. Employee rights are limited compared to the U.K., the EU, and Australia.

This blog explains how citizens (and their companies) from a tax treaty country are taxed in the U.S.

I am using the U.S. Model Income Tax Convention (the “U.S. Model Treaty”) for this blog.  I will highlight the articles that apply to business.  I will make the treaty easy to understand by removing the tax jargon. 

If you would like to discuss a U.S.’s tax treaty, then please call me, Brian Dooley, CPA, MBT at (U.S.) 949-939-3414.

 Next, I will explain the U.S. tax law on doing business in USA.  

Lastly, I will have some questions that I am frequently asked and the answer.

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Why JFK Said Avoiding Taxes is Patriotic & Good for America

tax planning, avoid taxes, small tax business,

President John Kennedy (Democrat) is the most respected president of last century. The President and Supreme Court Justice Hand agreed that patriotism does not mean paying more than your legal share.
Supreme Court Justice Holmes said tax planning means you get as close to that legal line as possible

John F. Kennedy stated,  “My fellow Americans, ask not what your country can do for you, ask what you can do for your country.”

He also said that  “Every dollar released from taxation that is spared or invested will create a new job and a new salary.”

You, the business owner, are the only one that creates real jobs. The more you avoid taxes, the more jobs you can create. Continue reading

Saving Taxes as the U.S. Goes to the Trump International Tax Plan

Will it be protectionism or something more dramatic?  International Tax Planners are shifting their client’s tax strategy now getting ready for this Fall.

Small Business Tax Planning. Try very hard to pay the least in taxes

Small Business Tax Planning. President Trump states “I fight very hard to pay as little tax as possible.”

Here is what’s happening.   First,  President Trump is proposing a 15%  U.S. business income tax rate.   The goal is to keep American businesses from going offshore.    The downside is this lower tax rate will apply only to corporations (excluding S-corporations).   When a corporate distributes its profits, it is called a dividend.   The shareholder pays tax on the dividend income.

Second, the wall.  I am not writing about the Mexican wall.  I am writing about the approximately 20% import duty.  The proposal is to apply this import tax to all countries that have a value-added tax (VAT).  All of Europe, the U.K., Canada, Australia, China, most of Asia and most of Latin America have the VAT.    So, just assume the whole world.

The result is a tax on imports and a lower tax on domestic production.   Domestic corporations will have more after-tax dollars for growth and improve efficiency.   This should allow for lower price goods.  Meanwhile, exports will cost 20% more due to the import tax.

International businesses are splitting and eliminating cross-border joint production and cost sharing programs.

Currently, corporations have a preferred tax savings with the foreign tax credit law.  The IRS  reimburses a domestic corporation the taxes paid by it or a subsidiary to a foreign government.    With the current high-income tax rate, the full amount of the foreign taxes were reimbursed.

But, with President Trump’s tax plan, the reimbursement will be reduced because the income tax rate is reduced to fifteen percent.   For example, if a foreign government tax rate is 30% and the U.S. business has a $1,000 of foreign income, the foreign tax is $300.   If the U.S. tax rate is 35% then the U.S. tax of $350 is reduced by the foreign tax of $300.   The net amount is paid to the IRS.

With President Trump’s tax law, the U.S. tax will be $150 (15% of $1,000).   The foreign tax will reduce only $150 of U.S.  taxes.    As a result, tax planners will want to avoid having plants, employees and “permanent establishments) in foreign countries unless their tax rate is less than 15%.

Currently, only Ireland fits a tax rate less than 15% and has the capacity to manufacture.

What about tax havens like the Cayman Islands?  They are too small for manufacturing or productions.

Tax havens are ideal for the internet business and for firms that stream content.   But, where good electricity for big equipment is required, they are not the best choice.

Summarizing this year’s foreign tax planning

Cross-border multi-national businesses are gearing up for all in one production within the U.S. for their American customers.   Likewise, these firms are going to be all in one within the EU  or the British colonies.  As a result, three separate free trade zones will develop (the U.S., the EU, and the British Colonies).

International tax strategies are now being developed for each of the three free trade zones.

Latin America countries, China and the rest of Asia will find their markets are changing.   They will be caught fall out from  President’s Trump isolation protective tax laws.  American international firms will find the overall tax costs too high in these countries and their market to weak.

Summarizing International Tax Planning for 2018 to 2020

Tax planning is not so much about today’s tax laws.  Tax planners closely look at the economic and political trends.  These trends shape future tax bills and tax planning is only for the future, not the present or the past.

The Wall Street Journal “Think Tank” blog’s headline today is Donald Trump’s Foreign Policy Is ‘America Only,’ Not ‘America First’.     The import duty to keep out foreign products and the lower corporate tax rate to keep American businesses in the Country is an “American Only” tax program.

Cross-border tax planners have noted this and are shifting their tax planning into three economic segments- the United States,  the European Union and the British Commonwealth.

If you need help with your international tax planning, then please call me, Brian Dooley, CPA, MBT, at 949-939-3414. We will help you “fight very hard to pay as little tax as possible.”

 

Preparing and Filing a Late Form 5471 for your Foreign Corporation Can Save You Taxes

Preparing Form 5471,

Your first Form 5471 will save you taxes when you elect sophisticated tax accounting methods. The elections must be made on the first Form 5471.

Late is not always bad especially with some IRS tax return.   Of course, some such as the Foreign Bank Account Reporting (FBAR) is a disaster.  The penalties are huge if you are late.

Other forms the penalty is not huge or they can be waived if you are not willful.  In any event, if you are reading this blog and your Form 5471 is late, then you will find a blessing in disguise on this page.

The most important tax return for every business is the first year return.  We call this the “initial return”.    Your tax accounting methods are made on this return.  Smart international tax planners attached a statement of all of the tax accounting methods used by their client.

By the way,  advance international tax planning strategies are always tax accounting methods.

Boring as watching grass grow,  cross-border tax accounting has a plan for every type of transaction.   Yep, every type.   For example, advance payments for products may allow a tax deferral that can last indefinitely.   The result is legal tax avoidance.
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