Forbes reports that there is $2.1 trillion dollars in profits sitting outside the US. Our government wants these US corps to bring the money in and pay 35%
Untaxed Offshore Profits
Answers
Add INVERSIONS into the mix?
Wayne
I don't think the US (if by that you mean the US Govt) is a factor here. But I would accept substituting Taxpayer:).
As long as the US has the tax code it does, the money won't come in. Why would it?
Weird that individual taxpayers with overseas income sources can't retain the income tax free overseas like corporations? The USA is one of a handful of countries that taxes individuals on worldwide income. That's another issue with the current tax code.
Yes, the IRS made it a mandate several years back to start collecting on money held overseas for individuals...
Would this tax on individuals off shore income therefore apply to offshore LLC or S Corp income or would these be treated similarly to a C Corp?
1
Good question...
Wayne, the ultimate truth in overseas profits is that those profits HAVE been taxed. The form to reference is schedule 5471, this form gives credit for foreign taxes paid on overseas profits but does not exclude the consolidated profits of multinational corporations.
It is truly sad that the individuals promoting the concept of corporate tax dodging that exist under transfer pricing regulations governed by OECD, IRC 482 and legally passed laws in local jurisdictions. The reason for these laws is to promote foreign direct investment. If not for Tax Free Havens and Holidays Singapore would not have had the desperately needed capital invested by foreign corporations in the early 90's. This not only trained their workforce but created applications in spin off
I often hear these arguments, mostly from people who cannot grasp the complexities of multinational taxation. I realize that is not your point by posing this question. One rule I have learned as a consultant is that you cannot fix 'stupid', we can do many miracles and work wonders on everything except that.
John
3
These need to be asked...
1. If they have already been taxed, what's the appeal or motivation?
2. Are you saying that these strategies are not being abused?
3. Aren't tax free havens the point of the question?
It will be interesting to see the repercussions of the leaked Panama Papers
Speaking of, So John, what is your opinion on the Panama papers?
Mr. Herndon, you can choose to insult me by calling me stupid. I've never needed to know the complexities of multinational taxation, although I think I could grasp the concepts. However, aren't we talking here about a lack of multinational taxation? Also, I don't think your response directly answered the questions.
The profits are indeed being taxed overseas where the source of income is so why should the Corporation be taxed twice on the same income and on a hefty 35%?
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