On July 10, 2020 I will present a live Section 962 webcast that goes into excruciatingly painful detail about preparing a Section 962 tax return.
This is the first draft of my notes for the part of the presentation that talks about where the rubber meets the road: the Section 962 Statement.
I probably won’t publish the notes as part of the webcast, but I will be sharing drafts on the blog. Later, there will be a complete recorded webcast/course materials package available.
Part 5 describes how you prepare the Section 962 Statement.... continue reading
The IRS can postpone deadlines when there is a Federally-declared disaster. IRC §7508A. We have one of those Federally-declared disasters right now, what with the coronavirus excitement and all of that.
The IRS, in a series of Notices, has given everyone until July 15, 2020 to do anything required to be done between April 1, 2020 and July 15, 2020.
These are the Notices that the IRS has issued so far to adjust filing deadlines and tax payment deadlines:
In late 2017 our Trusted Servants(TM) in Congress blessed us with a new tax law.
Among other features, the new law contained a spectacular Come to Jesus that absolutely hammered our minimultinational clients.
I speak, of course, of Section 965.
Consider a foreign corporation owned by an American living abroad. The foreign corporation operates an ordinary business. Dry cleaning. Gas station. Utterly mundane. It paid tax on its profits in its home country every year.
But the U.S. never taxed those profits. The general rule (in Ye Olden Days) was simple: you didn’t pay U.S. tax on foreign corporation profits until you take the money out of the foreign corporation.... continue reading
“How will they ever find out?”
It’s a classic tax-planning strategy that works very well, until the day it doesn’t work. Then it fails spectacularly.
Children do this all the time. They say “Dad said I could stay out until midnight!” to Mom and “Mom said I could stay out until midnight!” to Dad. This works until Mom and Dad compare notes.
It’s the same with taxpayers working across borders. If the tax authorities in Country A can’t see transactions that happen in Country B, then you can lie to Country A and get away with it. ... continue reading
The Tax Cuts and Jobs Act completely rewrote Section 965 to force a one-time repatriation of deferred earnings and profits in foreign corporations. It forces income recognition in the 2017 tax year, so there is not a lot of time to figure this one out!
I call this a workshop because the intention is for Rufus to talk a bit about the new law, then we will open it up for questions and input. Some of you out there are smart about Section 965, so please share with us.... continue reading