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Structuring a Foreign Investment in the United States

Structuring a Foreign Investment in the United States

by Jacob Stein

From a U.S. standpoint, no issue drives the structure of a Mergers and acquisitions (M&A) deal more so than taxation. The parties can negotiate and agree to all the other terms, but tax will determine how the transaction is structured, what is possible and what is not. This article will examine in detail the U.S. tax consequences of inbound investments and how to properly structure them.

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Pre-Immigration Tax Planning

Pre-Immigration Tax Planning

by Jacob Stein EB5_Magazine

There are three ways a country can define its tax borders: citizen-based, residence-based and territorial. A citizen-based tax system taxes all income earned by the citizen, regardless of where that citizen lives or where the income is earned. The residence-based model taxes worldwide income of those individuals who are resident in the country. The territorial system taxes only the income earned within the country. The United States uses both the citizen-based tax system and the residence-based tax system. U.S. citizens and U.S. income tax residents are subject to U.S. taxation on their worldwide income (net of deductions) as well as reporting requirements on certain foreign financial assets.

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Lawyer’s Guide to International Taxation Part II

Lawyer’s Guide to International Taxation Part II

by Jacob Stein California Business Law Practitioner Volume 30 / Number 2 - Spring 2015

Part I of this article addressed inbound taxation, including income taxation , FIRPTA, estate and gift taxation and various ownership structures for foreign investors. This part II addresses outbound taxation (including taxation of controlled foreign corporations, foreign trusts, and passive foreign investment companies; the foreign tax credit; and IC-DISCs) and expatriation.

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A Lawyer’s Guide to International Taxation Part I

A Lawyer’s Guide to International Taxation Part I

by Jacob Stein California Business Law Practitioner Volume 30 / Number 1 - Winter 2014

Our journey begins with a misnomer, "International taxation." The body of law addressed in this article has nothing to do with international taxation. There will be no discussion of the French VAT, the Italian IRPEF, or the Swedish PAYE. What is commonly referred to "international taxation" deals entirely with U.S. taxation - more accurately, U.S. taxation of cross-border transactions. 

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Foreign Investors Beware: Attribution of U.S. Trade or Business Through U.S. Agents

Foreign Investors Beware: Attribution of U.S. Trade or Business Through U.S. Agents

by Jacob Stein Journal of International Taxation

Foreign Investors, almost uniformly dislike paying U.S. taxes and filing U.S. tax returns. In many countries, for cultural, political, or personal safety reasons, privacy is paramount. Disclosure of one's financial affairs to any government is viewed as risky and something to avoid. Taxation of income earned in the U.S. may be unavoidable, and many foreign investors recognize that. With proper planning, it is possible that the U.S. -sourced income, while taxed by the U.S. at the corporate level, will not be taxed to the foreign investor personally. It is also possible that the foreign investor will avoid U.S. tax return filing obligations.

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Taxes Across Borders - A Guide to Foreign Investment in California Real Estate

Taxes Across Borders - A Guide to Foreign Investment in California Real Estate

by Jacob Stein California CPA Magazine, September 2013

While a non-resident alien (NRA) desiring to invest in US. real estate property typically has many goals, such as liability protection and privacy,the main     concern   is to minimize worldwide income and estate tax liability.

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The Tax Guide to EB-5 Investment in the United States

The Tax Guide to EB-5 Investment in the United States

by Jacob Stein EB 5 Investment Magazine, October 2013

A foreigner desiring to invest in a U.S. business or joint venture has many goals, including privacy, liability protection and the need to minimize world-wide income and estate tax liability. EB-5 investors are also concerned with the tax planning that needs to take place before the investor is granted permanent residence status in the United States.

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The Use of Entities in Structuring Foreign Investment

The Use of Entities in Structuring Foreign Investment

by Jacob Stein Business Entities, March/April 2013

International political uncertainty has continued to lead foreign investors to the U.S. The U.S. is politically and economically more stable, legally and fiscally transparent, and it imposes no currency controls. Various entity choices exist for investors.

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Tax Planning for Foreign Investment in California Real Estate

Tax Planning for Foreign Investment in California Real Estate

by Jacob Stein LA Lawyer, January 2013

THE RECENT CONFLUENCE of falling U.S. real estate prices and a weaker dollar, together with the flight of capital from Russia and China, has produced a significant demand for real estate in California, Florida, and Manhattan among foreign investors. This demand is fueled by the global perception that the United States is politically and economically stable (or at least more stable than the alternatives), has a transparent legal system that makes it easy for foreigners to invest in real estate and imposes no currency controls, making it easy to divest.

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Expand Choices by Creatively Unwinding Irrevocable Trusts

Expand Choices by Creatively Unwinding Irrevocable Trusts

by Jacob Stein Estate Planning, December 2012

Despite what its name implies, an irrevocable trust may be subject to change or termination through the implementation of various strategies.

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