Log in
Accounting
1
answer
0
watching
160
views
1 Nov 2018

C16-19

What is the deferral privilege? What tax provisions result inthe current U.S. taxation of part or all of a foreign corporation'searnings?

Watch
1
answer
0
watching
160
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Keith Leannon
Keith LeannonLv2
4 Nov 2018

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share

Related questions

Spartan Corporation, a U.S. corporation, reported $5.4 million of pretax income from its business operations in Spartania, which were conducted through a foreign branch. Spartania taxes branch income at 25 percent, and the United States taxes corporate income at 35 percent. (Enter your answers in dollars and not in millions of dollars.)

a. If the United States provided no mechanism for mitigating double taxation, what would be the total tax (U.S. and foreign) on the $5.4 million of branch profits?

b. Assume the United States allows U.S. corporations to exclude foreign source income from U.S. taxation. What would be the total tax on the $5.4 million of branch profits?

c. Assume the United States allows U.S. corporations to claim a deduction for foreign income taxes. What would be the total tax on the $5.4 million of branch profits?

d-1. Assume the United States allows U.S. corporations to claim a credit for foreign income taxes paid on foreign source income. What would be the total tax on the $5.4 million of branch profits?

d-2. Assume the United States allows U.S. corporations to claim a refundable credit for foreign income taxes paid on foreign source income. What would be your answer if Spartania taxed branch profits at 40 percent?

What is the total tax for a-d2?

As we have studied international taxation issues and taxtreaties, you need to use that information to go a step further. Doa web search for companies who are, or have had, tax problems witha foreign country. Identify two different countries and researchthe issues the company had/has with the foreign country, what isthe tax law or calculation in question, how was it handled, if ithas been resolved, what was the resolution. What potential ethicalissues do international taxation conflicts identify orspotlight.

For those two countries, locate data on the size of theinternational economy, including data on international trade,foreign direct investment by U.S. firms, and investment in theUnited States by foreign firms. Find out whether each of thesecountries applies a worldwide or territorial approach tointernational income taxation. What is the top income tax rate forthose two countries?

Prepare an analysis of the data for a three-year period usingExcel and graph your results. Provide a summary of the informationand the inferences you can draw from it. Would you open a companyin those countries?

*All information can be found online*

Assignment 3: International Taxation and Foreign TaxCredits
Due Week 8 and worth 280 points

Assume you are a CPA employed as an international taxconsultant hired to provide advice to a U.S.-based client expandingoperations into foreign markets.

Using the Internet or Strayer Learning ResourceCenter, conduct research on the tax impacts for U.S. companiesexpanding into foreign markets.

Write a four to six (4-6) page paper in which you:

Based on your research, analyze themajor impact of using a controlled foreign corporation to expandabroad. Examine two (2) methods you would recommend to the clientto circumvent the provisions of subpart F to reduce the client'stax liability. Provide at least two (2) examples to support yourrecommendations.
Based on your research, create a plan for theclient to take advantage of lower taxes by shifting profits to thetax havens or lower tax countries instead of shifting investmentsto these countries. Provide a rationale to support your plan.
Develop a strategy for the client to convertpassive income into active income deferring immediate U.S. taxationuntil repatriated home based on your research. Provide support foryour recommendation.
Analyze the available foreign tax credits toyour client. Propose at least three (3) tax credits the clientcould use and the impact of the credits on other foreign lossincome. Provide examples to support your recommendations.
Use at least four (4) quality resources in

Related Documents

ACC 522
Final Exam
Study Guide
ACC 522 Study Guide - Midterm Guide: Accrual, Double Taxation, Contingent Liability
cerisescorpion516
ACC402 Lecture Notes - Lecture 14: Tax Bracket, Property Income, Taxation In Canada
greenmuskrat329
ACC30005 Lecture Notes - Lecture 9: Income Tax Assessment Act 1936, Legal Personality, Withholding Tax
ochreduck413

Weekly leaderboard

Home
Homework Help 3,900,000
Accounting 580,000
Start filling in the gaps now
Log in