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April 21, 2020 - Phil Hodgen

Why a Section 962 Statement is Necessary

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.

Sign up to get the early-bird pricing here.

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Part 5 describes how you prepare the Section 962 Statement.... continue reading

March 19, 2019 - Phil Hodgen

Minimultinationals Chapter 02: It’s All Taxable to You

Introduction

All of the profits generated by a minimultinational enterprise will be exposed in real time to the U.S. tax system. Chapter 2 explains why.

We will talk about how the U.S. taxes those profits in future installments of this book. Different business structures have different tax results.1

Recap

What’s a minimultinational?

Let’s recap. A minimultinational is a small business that:

• Has U.S. owners; and
• Generates its profits outside the United States.

“Small” is relative. A minimultinational might have sales in the hundreds of millions or the hundreds of thousands.2

Who this is for?

This series is for owners of minimultinationals.... continue reading

February 1, 2019 - Phil Hodgen

Minimultinationals Chapter 01: Overview of the Series

American minimultinationals are small (for various definitions of “small”) business enterprises subjected to the U.S. tax system.

There are many ways that a minimultinational becomes exposed to the U.S. tax system. Doing business in the United States is an obvious way. If you have an office or employees in the United States, some portion of your business profits will be taxed.

I focus here on businesses that operate mostly or entirely outside the United States but are owned by U.S. citizens or residents. This factor alone–ownership by a U.S. person–means that the business profits will be exposed to U.S. income tax, even if the business never operates in the United States.... continue reading

January 18, 2019 - Phil Hodgen

American Minimultinationals: An Introduction

What’s an American Minimultinational?

What do I mean by American minimultinational?

Multinational

A multinational business operates in multiple countries, exposed to multiple tax-hungry governments. Apple. General Motors. Exxon.

A minimultinational is a multinational business, but smaller.

• Do you have 100 people in a cubicle farm working on your international tax stuff? You’re a multinational.
• Is that thought ludicrous bordering on insane? You’re a minimultinational.

American

An American minimultinational is one that is owned by a U.S. citizen or resident.

Merely by having a U.S. citizen or green card holder as an owner, a business that operates 100% outside the United States is a multinational business.... continue reading

March 18, 2018 - Phil Hodgen

Upcoming Section 965 Workshop and a Collection of Links

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!

Rufus Rhoades will give a one-hour free workshop on March 23, 2018 at 9:00 am Pacific Time. Register here; it’s free.

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