International Tax Nuances and Tips that accounting firms need to consider

Introduction:

Explore the world of international tax planning and business strategies with our latest podcast featuring Patrick McCormick, Founder of McCormick Tax, and Ganesh Ranganathan, CEO of Integra Global Solutions.

In this episode, you’ll cover:

• 01:21 Surprise traps for US taxpayers with foreign income: Patrick highlights that many taxpayers mistakenly believe that setting up a separate taxable foreign entity will shield them from US tax obligations. However, he explains that this is not the case, especially with the introduction of the Global Intangible Low-Taxed Income (GILTI) and Subpart F provisions.
• 04:27 Circumstances where multiple countries can tax the income: Patrick explains that international tax becomes relevant when a US taxpayer earns income sourced outside their country of residence. He further breaks down the two categories of US-sourced income: income effectively connected with a US trade or business (ECI) and fixed, determinable, annual, or periodic income (FDAP).
• 07:27 General reporting requirements for US taxpayers with foreign holdings: Patrick highlights the significant penalties associated with non-compliance, particularly for willful violations of the FBAR requirements. He explains that the penalties for willful FBAR violations can be up to 50% of the aggregated value of the accounts or $100,000, whichever is greater.
• 17:30 Guilty changed multinational activities landscape: McCormick explains that Guilty, introduced as part of the 2017 Tax Jobs Act, has changed the landscape of multinational activities by directly taxing US shareholders of controlled foreign corporations (CFCs) on their share of the CFC's guilty income.
• 24:32 Unexpected traps for US taxpayers with foreign income: Patrick McCormick shed light on the unexpected traps for US taxpayers with foreign income, the circumstances where multiple countries can tax the income, the general reporting requirements for US taxpayers with foreign holdings, and the implications of guilty and subpart f on multinational activities.

Podcast Summary:

In this insightful conversation, our experts delve into the intricacies of international tax planning, providing valuable tips and strategies for businesses operating globally. Whether you're a large firm or a startup eyeing international markets, this episode is packed with practical advice to optimize your tax structure and enhance your business operations.

Accounting firms can leverage this expertise to expand their list of services.

1. International tax regulations and compliance
2. Effective tax planning for businesses expanding globally
3. Opportunities and challenges in international markets

Our guests bring a wealth of experience to the table, and their expertise can empower your accounting firm to offer these services.

About our Guest:

Patrick McCormick is a highly skilled attorney with over a dozen years of expertise, specializing in international taxation. Patrick started his firm, McCormick Tax, in 2010 and has since become a leading authority in the field. He is known for his speaking engagements and has a mailing list of over 100,000 unique visitors who have attended his programs. Patrick also serves as outsourced International tax counsel to smaller and mid-sized accounting firms in over a dozen countries.

Patrick has successfully represented a diverse clientele, including multibillion-dollar businesses, high-net-worth individuals, startups, and expatriates. His unique background equips him to navigate the complexities of international tax issues, making him a sought-after authority in the field. As a guest, Patrick offers valuable insights and real-world perspectives on the dynamic landscape of global financial regulations.

About our Host:

Ganesh Ranganathan is the President and founder of Integra Global, a leading accounting outsourcing company. Ganesh is a seasoned executive with more than 25 years of experience in the accounting outsourcing industry.

Ganesh is committed to creating a supportive work environment that fosters creativity and innovation, and he is passionate about delivering exceptional customer service in the accounting industry.