A well-planned tax structure is only efficient if operated properly. A missing return or under reported earnings can result in costly penalties and interest, and although it is typically lack of knowledge which results in these errors, the IRS does not allow ignorance as a defense. The IRS will argue you should have obtained someone with expertise in international taxation.
The TCJA has put even more pressure on international tax compliance with the deemed repatriation tax (i.e., U.S. tax imposed whether or not the cash/assets offshore are actually sent back to the U.S. ). This tax uses foreign earnings and profits (“E&P”) as the base to apply tax rates, which is a complex term and should only be calculated by a professional with experience in this particular area.
International tax returns, including:
- Form 8832, Entity Classification Election
- Form 926, Return by a U.S. Transferor of Property to a Foreign Corporation
- Form 5471, Information Return of U.S. Persons With Respect to Certain Foreign Corporations
- Form 8621, Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund
- Form 8865, Return of U.S. Persons with Respect to Certain Foreign Partnerships
- Form 8858, Information Return of U.S. Persons With Respect to Foreign Disregarded Entities
- Form 1118, Foreign Tax Credit-Corporation
- Form 1116, Foreign Tax Credit-Individual, Estate, or Trust
- Form 8938, Statement of Specified Foreign Financial Assets
- Form 1040NR, U.S. Nonresident Alien Income Tax Return
- Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts
- Form 3520-A, Annual Information Return of Foreign Trust with a U.S. Owner
- Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons
- Form 1120-F, U.S. Income Tax Return of a Foreign Corporation
- Form 5472, Information Return of a 25 Percent Foreign Owned U.S. Corporation or a Foreign Corporation Engaged in a U.S. Trade or Business
- Form 8288, U.S. Withholding Tax Return for Dispositions by Foreign Persons of U.S. Real Property Interests
The TCJA made significant changes to domestic tax law as well. The removal of most itemized deductions for individuals and changes to depreciation, net operating loss deductions, and entertainment expenses for businesses, requires a change in how domestic compliance is approached. Let ITA walk through your prior-year returns and explain how changes to things like your marketing program can allow you to maintain certain deductions.
Domestic tax returns, including:
- Form 8832, Entity Classification Election
- Form 1120, 1120-S, U.S. Corporation Income Tax Return, U.S. Income Tax Return for an S Corporation
- Form 940, Employers Annual Federal Unemployment Tax Return
- Form 1040, U.S. Individual Income Tax Return
- Form 1099s, various information returns
- Form 8824, Like-Kind Exchanges
- State and Local Income, Sales & Use, and Payroll tax returns
