Tag Archives: international tax

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.    Hard to believe that Senator Bernie Sanders  (who paid tax at 13%) released the report.  It states that a business that plans its taxes are taxed at 14%. Here’s what’s going on.   

International tax planning for the Contract Manufactuere

International tax planning for the Contract Manufacturer

Fantastic 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.

Small businesses are now reaping significant 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 foreign 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 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 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 in 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 avoid 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.

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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Using Foreign Offshore Trusts to Hold Business and Investment Assets

Save taxes and protect assets by using a foreign offshore trust. Nat King Cole was the first famous American to teach the IRS Americans legally avoid taxes.

Save taxes and protect assets by using a foreign offshore trust. Nat King Cole was the first famous American to teach the IRS Americans legally avoid taxes.

If you believe your heirs are not capable of managing your assets, then a foreign trust should be considered.  Beginning in the 1970’s, wealthy Americans have used offshore trusts for their international tax planning and estate tax planning.

Beginning in the 1970’s, wealthy Americans have used offshore trusts for their international tax planning and estate tax planning.

In some cases, the foreign trust is used merely to avoid state income taxes.  The design of the trusts determines its tax profile.  For example, Nat King Cole legally avoided income taxes (both Federal and state, California) and estate taxes.

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Avoid Taxes Learn What the IRS Teaches Auditors About Sham Transactions

saving taxes, tax planning,

Saving taxes requires you to plan your taxes. Tax Planning takes time and effort. The Department of the Treasury governs the IRS.

Wow, the IRS must have a new group of hot shot attorneys.  They are wiping out small businesses tax planning with the concept of a sham. International tax planners seem to fall prey to this new IRS attack, and it costs their client’s big.

I found an IRS internal report to its auditors explaining the sham transaction.  I have the report below in blue print. The report is good news for tax planners. The auditors are being trained using older concepts.

Also, you will note, the report is not overly clear.  The best part is in the last paragraph.   Continue reading

IRS Wipes out 150 Man Law Firm Paying Year End Bonuses

Brinks Gilson & Lione is a fantastic intellectual property law firm.   The law practice operates with a corporation taxed under Subchapter C.  This means that the corporation pays the taxes.   If the shareholder(s) receive a dividend, they pay tax again.

This is known as double taxation.  Toss in state double taxation and you can see it is not fun.

The firm is reported to have  150 attorneys.  It has about sixty shareholders.  The non-attorney staff is over two hundred employees.

I have met many CPAs tell their clients to “zero out” their profits.  They tell the clients to “bonus” all of the income before the year end.  Usually, this is in December.

Most clients like an easy “tax plan.”   This tax plan is easy.  You just look at your bank balance and write yourself a “bonus” check.   As Brinks Gilson & Lione learned (the hard way), this is not law… it is not even close.

So, how do 150 attorneys not know the tax law?  It is easy.   Advance tax law is not taught in law schools (nor in the accounting schools).  Let me say write this again… your CPA and attorney know little, very little tax law.  Two exceptions.. an attorney with an LLM in taxation and a CPA with Masters in taxation (such as your author).

Year End Bonuses Are Bad Tax Planning

Here is how the IRS easily win.  At the end of a year, the corporation looks at its profits.  If it did well and had extra cash, a corporation declares a dividend. This law firm did just that except for they labeled the money as a “bonus.”

Just before year end, it wanted to “zero out” its taxable income.  The law firm used the “cash method” of accounting.  Of course, money has to be kept to meet January’s payroll, rent, etc.

But the rest was extra cash. It paid it to the shareholders.  It was a reward for the corporation, as a going concern, including the other 300 employees, success.

International Management Fees Are Bad Tax Planning

Multi-national companies use management fees to move profits from one corporation to another.  The seem theory applies to management fees.  They are not a valid international tax strategy.

Whenever you owe tax, the IRS charges a negligence penalty unless you can show that you had what is known as a “substantial authority”… such as a court case or an IRS ruling.  Of course, you have to had known about the substantial authority before you did the tax return.

So, the attorneys went to tax court claiming that IRS was wrong in accessing the penalty.  The boldly go where no attorney should go and told the judge that they had a case that was kind of on point.    One problem… the case was decided after they filed the corporate tax return.

Tax planning for the entertainer

The entertainment industry uses a corporation taxed under Subchapter C, just as this law firm did.  The tax plan is to “zero out” the profits at the year end, just as this law firm did.  Loan out corporations that have expenses that help produce the income, other than the wage to the shareholder, face the same problem.     It is better to have a high salary and forgo a paycheck (if the money is not in the bank) than to have a year bonus.

The good news for the entertainment tax planner is the case the law firm cited to avoid the penalty.  In Law Offices Richard  Ashare, P.C. v. Commissioner (on this link).  Mr. Ashare was his corporation’s s sole shareholder and the only professional employee.  If you are in the entertainment business this is an important case for your CPA.