Foreign Earned Income Exclusion

Foreign Earned Income is exempt from U.S. taxation (up to certain limits) for salaries and wages received for services while working in a foreign country during which your tax home is in a foreign country, and either the bona fide residence test or the physical presence test is met.

For optimal tax savings, certain considerations must be made, and tax calculation to ensure you are claiming the full benefit of the exclusion.

Foreign Tax Credit

A Foreign Tax Credit is generally applied to mitigate the potential for double taxation dollar-for-dollar.

To determine the proper use of the credit, a compliance review and International Tax Structure may be necessary to determine the proper application under the law.

U.S. Taxation of Foreign Corporations

Foreign Corporations (or their respective subsidiaries) are generally subject to U.S. income tax only on their U.S. source income or Effectively Connected Income with a U.S. trade or business or branch and subject to various special tax rules. Additionally, other complex anti-deferral rules may apply.

To better understand the tax implications and calculations, an International Tax Structure can get you on the right track going forward.

Need to Plan Your Own Structure?

Work with us to develop tax charts that visually detail inbound and outbound International Tax transactions in relation to the United States taxing system.

With a given scenario, the deliverable will highlight the flow of income, expenses, other cash distributions, and summarize the tax implications and filing compliance.

Book an appointment to schedule a call for a tax structure consultation. Also feel free to send me a message before the call if not in communication already.