Tax Implications of International Investment
International Tax Attorneys
What are the tax implications of international investment? Are you in full compliance with IRS offshore reporting requirements, FBAR and California tax disclosures?
There are three primary international investment vehicles:
Exchange Traded Funds
American Depository Receipts (ADRs)
Foreign corporations are taxed by the sovereign tax authorities in their own nation. If a U.S. taxpayer were to pay taxes on the dividends earned through foreign corporate ownership, they face double taxation. The U.S. tax code usually provides a tax deduction or credit on taxes paid to a foreign government up to the rate you would pay in U.S. taxes. IRS Form 1116 is used for this purpose; however, there are occasions where a deduction might be the better strategy.
What are the tax implications of international investment for your unique circumstances? Allen Barron integrates a unique blend of international tax, accounting, business and legal services in a single source provider, headquartered in our San Diego offices. The world has significantly changed over the past several years, and the impact of FATCA upon investment and taxation around the world cannot be understated. Now more than ever, it is important to work with experts who can advise you across a broad spectrum of issues associated with foreign investment, from FBAR reporting to PFICs, to ensure accurate classification of offshore accounts income and full compliance with all IRS and state tax reporting requirements.
Generally speaking, the Foreign Tax Credit protects U.S. taxpayers who are investing in offshore vehicles from paying investment-related taxes twice.
U.S. Taxpayers are Taking a More Global Investment Perspective
While the stability of many regions around the world seems to change from moment to moment, the reality of recent global diversification has brought attractive investment opportunities around the world. U.S. taxpayers understand that market sectors may be more correlated to profitable returns than investing in specific countries; however, the tax implications of international investment across multiple strategies becomes more complex, and the penalties for failure to understand reporting requirements and tax ramifications of international investment continue to grow.
Global diversification and international investing may reduce the volatility of many portfolios, and the range of losses in periods of poor performance are smaller than many onshore alternatives. International transactions are, by their very nature, much more complex. International business and investment transactions involve joint ventures, real estate projects, mergers, acquisitions, shared services and other complex financial transactions.
The tax attorneys and accounting professionals at Allen Barron provide familiarity with foreign tax laws and international business practices for those who are investing in offshore companies and investments, as well as permanent residents and U.S. taxpayers who maintain offshore real estate ownership, foreign bank accounts and investments. We help you to make sense of the complex compliance requirements and fully understand the tax implications of international investment.
Contact Us To Learn More About Allen Barron's Services
Offices of Allen Barron, Inc.
16745 West Bernardo Drive, Suite 260
San Diego, CA 92127
5720 Oberlin Drive
San Diego, CA 92121
333 South Sixth Street, Suite 230
Las Vegas, NV 89101
750 B Street, Suite 2610
San Diego, CA 92101
300 Montgomery Street, Suite 410
San Francisco, CA 94101
40 North Central Avenue
Phoenix, AZ 85004