The newly enacted Tax Cuts and Jobs Act (the "Act") gave us what some people refer to as "mandatory repatriation" for previously untaxed foreign earnings of specified foreign corporations. In other words, Section 965 of the Internal Revenue Code now requires some taxpayers to pay tax on the untaxed foreign earnings of certain foreign corporations as if the earnings had been repatriated to the United States. This will take effect for the 2017 tax year for a majority of taxpayers.
US individual shareholders of controlled foreign corporations (CFCs) are currently grappling with the one-time US transition tax on post-1986 deferred foreign income accumulated by their CFCs and the impact of new anti-deferral income inclusion rules referred to as the global intangible low-taxed income (GILTI) provisions, along with other generational changes to the US international tax rules, as the United States transitions from a worldwide tax system to a quasi-territorial tax system.
The Internal Revenue Service has recently announced the launch of country-by-country (CbC) reporting pages on irs.gov which will provide background information on CbC reporting, frequently asked questions and other helpful resources, including a list of jurisdictions that have concluded competent authority arrangements with the United States.
According to UHY partner Christopher Byrne, Internal Revenue Code § 121 provides taxpayers with an exclusion from gross income of up to $250,000 of gain on the sale of a taxpayer’s principal residence. A married couple filing a joint return may exclude up to $500,000. In order to qualify for the exclusion, the residence must have been the taxpayer’s principal residence for an aggregate of 2 years or more during the 5 year period leading up to the sale. The determination of a principal residence is a question of facts and circumstances.
In an ever-globalizing world, U.S. tax payers are looking abroad for their insurance needs. According to UHY partner Christopher Byrne, while taxpayers may find certain benefits from policies issued by a foreign insurer that they might not find domestically, many find themselves with a rude awakening when they are hit with a surprise surcharge from the IRS. Pursuant to Internal Revenue Code § 4371(2), a one percent excise tax is charged on the premium paid on a policy for life, sickness, or accident insurance or an annuity contract.
If you are required to file partnership tax returns, C corporation tax returns, or foreign information reporting (FinCen 114/FBAR), the Surface Transportation Act of 2015 ("the Highway Act") brings some actionable news regarding revised filing deadlines effective for 2016 tax returns. The current partnership return deadline imposes a problem for many partners to timely file their returns by April 15. The partnership due date change may give more time for partners to include any Schedule(s) K-1 income and/or loss on their personal income tax returns and file by April 15.
In a recent speech at the Olympic Training Center in Lake Placid, democratic Senator Charles Schumer of New York, called on the House to pass legislation that would give Olympic and Paralympic athletes a tax exemption on their Olympic medals and monetary bonuses. Schumer expressed that it was wrong to tax these athletes after earning a hard fought victory for the country.
Do you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, or other type of foreign financial account? If you do, and certain thresholds are met, then filing of FinCEN Form 114 Report of Foreign Bank and Financial Accounts will be required to avoid substantial penalties.
The Tax Foundation released a study called the International Tax Competitiveness Index, in which our great nation ranked 32nd out of 34 countries in the Organization for Economic Cooperation and Development in relation to tax competitiveness. The study compared tax systems using over 40 variables in five categories: corporate taxes, consumption taxes, property taxes, individual taxes and international tax rules. The study claims that the US individual income tax system is poorly structured, confusing and has high rates.
The IRS has issued final regulations on the application of the rules that require certain domestic entities to annually report their interest in certain foreign assets effective for tax years beginning after Dec. 31, 2015. Beginning Jan. 1, 2016, the IRS now requires specified domestic entities - partnerships, corporations, or trusts to also attach Form 8938 to their tax return.
Wednesday May 16 2018 | 4:30PM—6:30PM |
Scarab Club | 217 Farnsworth Street | Detroit, MI 48202
Ann Arbor Club | 103 E Liberty Ste# 300 | Ann Arbor MI 48104 |
Wednesday May 2 2018 | 4:30PM — 6:30PM
Thursday April 19 2018 | 7:30AM – 10:00AM |
Hosted at UHY’s training center in Farmington Hills