Discussion:C Corporation with 100% Foreign Owner
From TaxAlmanac
Revision as of 22:00, 11 November 2007
Discussion Forum Index --> Advanced Tax Questions --> C Corporation with 100% Foreign Owner
Discussion Forum Index --> Tax Questions --> C Corporation with 100% Foreign Owner
| 11 November 2007 | |
| I have a new U.S. Corporation client that is owned by a individual in Liechtenstein. 2007 is the first year of U.S. business operations. We are working on setting up a strategy to get profits from the U.S. Corporation back to the individual owner in Liechtenstein or at least to another European country. Owner also has another European Company. (Germany). I have read several posts within Tax Almanac which has been helpful. We will need to file a Form 5472 and I am in the process of getting an ITIN for individual owner. Absent any treaty benefits (I don't see a U.S Liechtenstein tax treaty), I understand that a 30% withholding amount is required to get U.S. Source Income paid out.
Some options that I have thus far: 1. Management Fee paid from U.S. Corporation to German Co. Not sure if this is required to 30% withholding (I see the tax treaty does not address management fees). This might also trigger an 1120-F filing requirement for foreign co. Also transfer pricing issues... 2. Management Fee paid to individual with 30% withholding (since no tax treaty). This would also trigger Form 1040NR filing, I believe. I am sure I am simplifying things here, but this is a complicated area that I am embarking on and I appreciate any help in advance... Any ideas/strategies are much appreciated. | |
