Hi from Phil, and welcome to the Friday Edition. Every other week you get something about International Tax from me. And every now and then, a Jello Shot from a random airport somewhere. If you want these to stop, just click the unsubscribe link at the bottom of this email.
Your U.S. government (say that in your best reverberating sports stadium announcer’s voice, the way the guy says “Your Los Angeles Dodgers”) is on the move again.
More “transparency for thee, but not for me” stuff from Your Public Servants.
This time, it is aimed at nonresidents who buy U.S.... continue reading
[Note: I am preparing the course materials for an all-day program I am teaching for the California Society of Certified Public Accountants on the taxation of multinational families. This is a portion of the handout I am writing.]
You do not have a green card, and you were not in the U.S. enough days to meet the substantial presence test. You want to be a U.S. resident for income tax purposes. Here is how you do it, by making a special election under Section 7701(b)(4) of the Internal Revenue Code.Why
This election is used by nonresident aliens who become residents of the United States after the middle of the year, and do not hold a green card. ... continue reading
One of the continuing mysteries of life involves the concept of “basis”. Think of basis as your acquisition cost. This is essential in calculating your capital gain tax after selling an asset. Capital gain is the difference between the sale price and your acquisition cost. The higher your basis — or acquisition cost — for an asset, the lower your capital gain (and therefore capital gain tax) will be.
Here is an example:
... continue reading
A person bought a piece of land 20 years ago for $100,000, and now it is worth $1,000,000. If that person sells the real estate today, the capital gain would be $900,000 ($1,000,000 received from sale minus $100,000 acquisition cost).