Tax Lawyer for Outbound Capital
Investing capital and moving assets overseas can have significant tax advantages, risks, and consequences.
Deploying U.S. capital and assets abroad can yield exciting returns, open new markets, and generate growth. It can also offer significant tax savings if the income earned is sourced to a low-tax jurisdiction.
But making that happen can mean negotiating a labyrinth of complex and unhelpful tax provisions.
- U.S. persons and companies are taxed on their worldwide income, with only an offset for the foreign taxes paid.
- The two foreign tax credits (Internal Revenue Code §§ 901, 902) can be limited in a number of ways
- Subpart F can help you defer paying U.S. taxes on foreign income until it has been repatriated
- Neither credit may be available unless you had the foresight to arrange your business affairs in particular ways.
- Moving any asset out of the United States, particularly intangible assets, can be seriously inhibited by a variety of tax code provisions specifically designed to inhibit transfers abroad
- Even after relocation the transfer pricing rules may act to allow U.S. taxation of a significant portion of your worldwide income
The bottom line: Moving from a domestic to an international business model offers real advantages and comes with real tax risks. Tom is a top international tax lawyer and can help you understand and manage those risks, and thereby maximize your company’s chances to succeed.
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Did You Know?
If a lender forgives all or some of a debt owed, you may well have to pay income tax on the amount forgiven.