The Tax Cuts and Jobs Act enacted in December 2017 (the “Act”) generally became effective in 2018 and change the tax planning landscape for foreign investors in the United States. Some examples of these changes include:
- A 23 percent flat corporate rate is now available
- Current expensing of the acquisition cost of tangible assets is available
- Proposed expensing regulations that were issued in early September
- New stringent limitations on deduction of business interest and deduction of cross-border “hybrid payments” are now in place
- Larger foreign investors may be subject to the new base erosion anti avoidance tax (BEAT), essentially a minimum tax
Furthermore, the list of optimal structures for investment in U.S. real estate and business operations has changed and, in some sense, has been simplified. Proposed, and in some cases final and temporary regulations, have been issued for most of the provisions relevant to a foreign investor. These regulations are critical in applying the provisions of the TCJA. In addition to this, new forms have been released, such as:
- Form 8991 for calculating the tax on base erosion payments
- Form 8990 for determining the limitation on business interest
Revisions to other forms have or may be released such as with Form 5472 for reporting information of a 25 percent foreign-owned U.S. corporation or foreign corporation engaged in a U.S. trade or business.
In this practical webinar, you will learn the practical aspects of the provisions of the TCJA most relevant to the structuring of foreign owned investors in the United States. You will also learn the changes to tax compliance responsibilities of foreign owned U.S. enterprises. Among other things, you will learn about the structures commonly used post-Act for foreign investment in U.S. business operations and real estate.
Upon course completion, you will be able to:
- Calculate the limitation on business interest of foreign owned domestic corporations
- Identify hybrid payments made to related foreign persons
- Compute the Base Erosion Anti-Avoidance Tax (BEAT) of a domestic corporation
- Identify structures for foreign investment in U.S. real estate
- Identify structures for foreign persons to establish and finance U.S. business operations
- Navigate major tax reporting and compliance forms typically required of foreign investors
Field of Study: Taxes – Technical
Program Level: Intermediate
Credit Type: Group Internet-Based for the Live Program.