Simply put, literally all transactions between a U.S person (or entity) and a foreign person (or entity)normally results in at least one, or more, tax events (i.e., a recognition of a tax liability OR a realization of a tax liability; in other words, immediate payment of tax). Transactions between businesses, transfers of assets overseas, income earned from offshore activities and U.S. persons owning shares in a foreign corporation are only a sample of the events that could trigger a tax event. However, with proper structuring and planning, many tax events can be minimized and, possibly avoided. Many U.S. tax advisors (attorneys and CPA’s) with excellent reputations and experiences can navigate their clients through the maze of domestic tax rules and regulations but sometimes fail to advise (and/or possibly consider) the ramifications of the international tax rules and their possible effect upon a transaction. International Tax Consultants fills the knowledge gap by specifically advising the client of the international tax consequences of any contemplated transaction and devising methodologies, when appropriate, to minimize the exposure to taxation in the transaction or eliminate the possibility taxation altogether.

Furthermore, there are many misconceptions in the offshore world about taxation issues, mostly propagated by questionable providers of offshore products upon the investing public. Many of the misconceptions, misstatements or outright inaccuracies made by these providers revolve around the following blatant statement:

“With the use of offshore techniques and structures, one can escape the payment of tax in the U.S. of any type if…”

  1. you move your business assets offshore into an offshore entity (corporation, trust, etc.) and transact them from the offshore entity, no taxes would result;
  2. if products from your domestic company are shifted to your offshore subsidiary or branch office and sold from offshore, there would be no taxes because the seller is not in the U.S.;
  3. you establish an entity offshore in order to transfer your personal assets in order to eliminate any estate taxes and then sell or dispose of the assets from the offshore entity and receive tax-free proceeds from the sale;
  4. you believe the oft-quoted statement espoused by advisors on the criminal side of the fence that “. . . you’re offshore . . . all bets are off . . . once offshore, the IRS won’t find out about it . . . what difference would it make . . . you won’t get taxed anyway . . . .”
  5. if one establishes an investment account with a broker through an offshore corporation or trust, there is no tax paid on the profits and earnings in the account.

There are certainly other “sales pitches” made by unscrupulous offshore providers along the lines of the statements made above; however, to give them space here would be tantamount to providing them credence and credible exposure. Any acceptance or adaptation of any of the above misconceptions may and usually lead to some nice vacation time at Club Fed.

Moreover, the majority of experienced, professional and reputable offshore providers located in non-U.S. jurisdictions advise all of their clients (especially U.S. based customers) of their inability and reluctance to provide specific tax advice on the use and implementation of structures or plans sold by them. In their literature and their websites, it is plainly stated that each client seek independent tax advice and counsel from their own advisors with respect to their activities as it pertains to their home country.

ITC facilitates and provides that independent tax advice needed and sought by businesses, entities, individuals and offshore service providers for their offshore transactions with emphasis placed on the analysis and application of the international tax rules as it pertains to U.S. citizens and other non U.S. nationals. We can work in harmony with one’s existing tax advisors and/or legal counsel to provide a comprehensive team effort approach to the impacts of the international tax consequences to any transaction or structure or, ideally, provide the complete professional advice needed to navigate through the complications of the international tax rules and their impacts.

Our staff of consultants, all whom are either attorneys or CPA’s with extensive international tax backgrounds, some with former Internal Revenue or Department of Justice experience, stand ready to serve our clients competently and professionally by placing total client service first, and finding timely solutions to international tax issues reliably.