Browse Articles:   By Category   /   By Author
HIDE

Other Publications

Insights

Publications

Help – My Exclusively Foreign Trust Now Has a U.S. beneficiary! What Are the Issues a Trustee Will Now Face in 2020?

/
Help – My Exclusively Foreign Trust Now Has a U.S. beneficiary! What Are the Issues a Trustee Will Now Face in 2020?

For many wealthy families based in Europe, elegant private client planning is performed to high European standards. Then, one or more of the heirs moves to the U.S. What should be done to keep the family assets away from U.S. income tax and future estate tax? Good answers are not easy to come by, especially when the adviser suggests disqualifying the U.S. beneficiary from trust benefits. Surely, there must be a better way. There is, and in her article, Nina Krauthamer explores the issues and possible solutions to the ultimate conundrum.

Read More

Foreign Tokens – U.S. Tax Characterization: Questions and Discussion

/
Foreign Tokens – U.S. Tax Characterization: Questions and Discussion

· Initial coin offerings (“I.C.O.’s”) provide blockchain-based companies with a new way to raise capital. Companies in the U.S. and abroad have been raising capital using blockchain technology since 2016. As this means of raising funds gained popularity, the S.E.C. ruled that some tokens are securities, making U.S. I.C.O.’s subject to Federal securities laws. Tax questions also arose, but not all questions have been addressed by the I.R.S. Specifically, no guidance exists with respect to the proper characterization of a token, and as a result, U.S. investors are not assured of the tax consequences of their investments. Galia Antebi and Andreas A. Apostolides guide the reader through the issues, identify the problems, and suggest solutions where appropriate.

Read More

Proposed Amendments to F.A.T.C.A. Suggest Reducing or Deferring Withholding

/
Proposed Amendments to F.A.T.C.A. Suggest Reducing or Deferring Withholding

In mid-December 2018, revised F.A.T.C.A. regulations were proposed by the I.R.S. Highlights included (i) the elimination of withholding on payments of gross proceeds, (ii) deferral, but not elimination, of withholding on foreign passthru payments, (iii) clarification of the definition of an investment entity, and (iv) changes to the consequence of hold-mail instructions on presumptions of residence. Galia Antebi explains all.

Read More

I.R.S. Adds New Issues of Focus for Cross-Border Audits

/
I.R.S. Adds New Issues of Focus for Cross-Border Audits

In late 2018, LB&I announced five additional campaigns aimed at determining whether taxpayers are complying with tax rules in the following areas of the law: (i) foreign tax credits claimed by U.S. individuals, (ii) offshore service providers that assist taxpayers in creating foreign entities and tiered structures to conceal the U.S. beneficial ownership of foreign financial accounts, (iii) F.A.T.C.A. compliance by F.F.I.’s and N.F.F.E.’s, (iv) tax return compliance by foreign corporations that ignore the fact that they are engaged in a U.S. trade or business under the rules of U.S. tax law, and (v) late issuance of Work Opportunity Tax Credit (“W.O.T.C.”) certifications that result in the need to file amended tax returns and result in a misuse of I.R.S. resources when returns are filed without the W.O.T.C certifications. The move follows more than two years, of I.R.S. publications that alert the public to certain issue-based approaches being followed by examiners. Galia Antebi and Elizabeth V. Zanet summarize the new releases.

Read More

F.A.T.C.A. – Where Do We Stand Today?

/
F.A.T.C.A. – Where Do We Stand Today?

When F.A.T.C.A. was adopted in 2010, the hoopla from the U.S. Senate promoted the idea that the I.R.S. would become invincible in rooting out recalcitrant Americans not wanting to pay tax and the financial institutions willing to assist them. In principle, information in U.S. tax returns could be compared with F.A.T.C.A. reporting by foreign financial institutions to identify which taxpayers remained offside and which banks had insufficient reporting systems. A recent report by the Treasury Inspector General for Tax Administration (“T.I.G.T.A.”) concluded that after spending nearly $380 million, the I.R.S. is still not prepared to enforce F.A.T.C.A. compliance. In their article, Rusudan Shervashidze and Nina Krauthamer summarize the principal shortfalls and possible solutions identified by T.I.G.T.A. and which suggested action plans the I.R.S. will contemplate.

Read More

Insights Vol. 5 No. 8: Updates & Other Tidbits

/
Insights Vol. 5 No. 8: Updates & Other Tidbits

This month, Rusudan Shervashidze, Neha Rastogi, and Nina Krauthamer look at several interesting updates and tidbits, including (i) potential tax reasons for Cristiano Ronaldo’s move to Italy, (ii) a law suit brought by high-tax states against the U.S. Federal government in connection with the T.C.J.A. limitations on deductions for state and local taxes, (iii) the finding of the European Commission that the aid given to McDonalds by the Luxembourg government did not constitute illegal State Aid, and (iv) a successful F.A.T.C.A. prosecution against a former executive of Loyal Bank Ltd.

Read More

I.R.S. Information Exchanges & the Coordinated Tax Raids on Credit Suisse

/
I.R.S. Information Exchanges & the Coordinated Tax Raids on Credit Suisse

In April, coordinated tax raids targeted three separate offices Credit Suisse involved in tax fraud examinations by the Netherlands, France, Germany, the U.K., and Australia.  Was it merely a coincidence that these are countries with which the U.S. regularly cooperates in the exchange of tax information?  Rusudan Shervashidze and Stanley C. Ruchelman discuss the many avenues through which the I.R.S. furnishes and receives information.  One thing is clear: The I.R.S. had the means to transfer information to the relevant tax authorities.

Read More

Looking to the Future: European Efforts Against Tax Evasion Take Center Stage – Where Will It Take Us?

/

A globalized economy has been the driving force behind cross-border tax transparency and increased dissemination of tax information in recent years.  The importance of F.A.T.C.A. reporting has paled as the O.E.C.D. Common Reporting Standard has taken effect in the E.U., State Aid cases are progressing, and country-by-country reports may be publicly available.  Europe and the U.S. are moving in different directions.  Philip R. Hirschfeld and Stanley C. Ruchelman explain.

Read More

A Year of Guest Features

/
A Year of Guest Features

This month, we reminisce on the best of 2016, with articles contributed by guest authors from around the world.

Read More

Global Exchange of Information: How Does the U.S. Fit into the Puzzle? Meet the U.S. Foreign Trust

/
Global Exchange of Information: How Does the U.S. Fit into the Puzzle? Meet the U.S. Foreign Trust

In the context of a model 1 I.G.A. under F.A.T.C.A., the U.S. undertakes certain reciprocal information exchanges.  But reciprocal may not mean equal.  This produces interesting results when a U.S. foreign trust is formed by a foreign individual.  Galia Antebi and Nina Krauthamer compare C.R.S. reporting and F.A.T.C.A. reporting in the context of a U.S. foreign trust that invests in U.S. assets producing tax-free income for a foreign investor.

Read More

New U.S. Model Treaty→

/

Published by GGi in FYI International Taxation News, No. 5: Autumn 2016.

Read More

Insights Vol. 3 No. 4: F.A.T.C.A. 24/7

/

This month, Galia Antebi and Philip R. Hirschfeld discuss (i) the growing list of countries with which the I.R.S. will exchange F.A.T.C.A. information, (ii) the litigation in Canada attempting to block F.A.T.C.A. exchanges with U.S., (iii) recent developments in acceptably encryption for F.A.T.C.A. exchanges, (iv) additional competent authority agreements, and (iv) an updated list of I.G.A. partner countries.

Read More

Insights Vol. 3 No. 3: F.A.T.C.A. 24/7

/

This month, Galia Antebi and Philip R. Hirschfeld discuss (i) changes to F.A.T.C.A. regulations designed to ease burdens on F.F.I.’s; (ii) continued I.R.S. interest in public comments; (iii) finalization of domestic entity reporting regulations under Code §6038D; (iv) an exemption from F.A.T.C.A. for a Swiss attorney’s confidential client escrow accounts; (v) competent authority agreements that have been reached with Brazil, Colombia, and Italy; and (vi) an updated list of I.G.A. partner countries.

Read More

Insights Vol. 3 No. 2: F.A.T.C.A. 24/7

/

This month, Insights looks at the I.G.A. experience in Mexico; updated Form W-8BEN-E and instructions; an announcement on forthcoming regulations that will ease burdens on F.F.I.’s; new I.G.A. competent authority arrangements signed with Norway, Barbados, Romania, Spain, Italy, and Costa Rica; a new I.G.A. with St. Lucia; and the most recent list of I.G.A. partner countries.

Read More

Insights Vol. 3 No. 1: F.A.T.C.A. 24/7

/

This month, recent developments in F.A.T.C.A. include the D.O.J.’s Swiss bank deferred prosecution program; new instructions for Form 8966, F.A.T.C.A. Report; six new YouTube videos regarding the Online Registration System; extension of time to file F.A.T.C.A. Reports; upgrade to F.F.I. lists, the current I.G.A. partner countries, and more.

Read More

The Common Reporting Standard – A Global F.A.T.C.A.?

/

The Common Reporting Standard ("C.R.S.") for the automatic exchange of information by financial institutions is now in effect for the 56 jurisdictions that are Early Adopters. How will the C.R.S. work and who will be affected? How does it interact with F.A.T.C.A. I.G.A.’s? Richard Addlestone of Solomon Harris, Grand Cayman answers these and other questions.

Read More

Insights Vol. 2 No. 10: F.A.T.C.A. 24/7

/

Recent developments in the F.A.T.C.A. practice include upgrades to the online registration system, a flurry of competent authority arrangements signed with other countries, F.A.T.C.A. guidance issued by the Turks and Caicos Islands, new authorizing statutes in Russia and Georgia, an implementing memorandum in Germany, an I.G.A. with Angola, updated F.A.Q.’s, and a list of Model 1 and Model 2 I.G.A. partner countries.

Read More

The Transparent World: Exchange of Information Has Begun & Pacts to Assist Implementation Have Been Signed

/

Despite efforts to repeal F.A.T.C.A. in the U.S. and opposition from abroad, it appears that F.A.T.C.A. is here to stay. Galia Antebi and Philip R. Hirschfeld address the recent September 30 milestone and the advent of exchanges of financial account information with tax administrations of I.G.A. partner jurisdictions.

Read More

Insights Vol. 2 No. 8: F.A.T.C.A. 24/7

/

This month, Philip R. Hirschfeld and Galia Antebi report on Republican-led efforts to curtail F.A.T.C.A., new F.A.Q.’s released by the U.S. and Mauritius, publication of the St. Kitts and Nevis I.G.A., updated foreign account reporting procedures, and much more.

Read More

Insights Vol. 2 No. 7: F.A.T.C.A. 24/7

/

July and August were busy months for F.A.T.C.A. developments. We explain the highlights:  The I.R.S. notified countries with early I.G.A.’s that more favorable provisions are available, but the notice may escalate the on-boarding controversy with Canada and the U.K.  The Common Reporting Standard (C.R.S.) is moving forward – either with or without U.S. participation – and global F.I.’s must adjust reporting systems.  Iceland and the United Arab Emirates publish F.A.T.C.A. guidance.  Belarus ratified the I.G.A. with the U.S. Italy published an implementation decree for exchange of information. Turkey and Slovakia signed Model 1 I.G.A.‘s. Mauritius and Luxembourg extend local F.A.T.C.A. reporting deadlines.

Read More