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Discussion Forum Index --> Advanced Tax Questions --> BVI or LLC?
Discussion Forum Index --> Tax Questions --> BVI or LLC?
Cadu (talk|edits) said:
| 16 January 2008
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| I am a brazilian lawyer. My client, a brazilian company, owns a BVI company and a Delaware LLC. They have some heavy equipment (formally owned by the BVI company) which is now in Arizona. They will send the equipment to Canada for repair. Is there any tax issue involved in this situation (transporting the equipment to Canada and paying the Canadian company for the repair)? They will also need to rent a space in order to store some other equipment in Arizona. Is there any tax issue here? And finally: is there any difference if they use the BVI company or the LLC as the owner of the equipment? I would be very thankful if someone can help me with these questions!
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Smktax (talk|edits) said:
| 16 January 2008
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| You should speak with a U.S. tax advisor that specializes in cross-border activities. The BVI company likely has U.S. tax filing requirements and may forfeit deductions if no U.S. tax return is filed. Other penalties may also apply if not structured and/or reported properly.
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Cadu (talk|edits) said:
| 16 January 2008
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| Thanks for your answer. So do you think the Delaware LLC is safer to use in this situation, as the company which is sending the equipment?
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Smktax (talk|edits) said:
| 16 January 2008
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| I do not have all of the details of your situation. It is therefore difficult to give you an answer to your specific question. If equipment is in Arizona, it is likely that either the Brazilian entity, the BVI entity, or the Delaware LLC will need to file U.S. tax returns and pay U.S. tax. Which entity needs to file and what forms they need to file depend on various factors. You should speak with a U.S. tax advisor.
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MDEA (talk|edits) said:
| 16 January 2008
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| golly I seem to recall reading a post by Eva Rosenburg on her Taxmama.com website about a company that thought they would save money by having equipment shipped out of the country for repairs and ended up paying tarifs that the repair company did not cover or disclose so more hassle and no savings to ship the equipment...you may want to google Taxmama.com site to see the post. it was in the last few months.
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