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Yearly Archives: 2012

Ecuador Declares “US LLCs” as a Preferential Tax Regime – Tax Haven!

                  

Preferential tax regimes are jurisdictions where income is subject to tax at a rate 60% lower than in Ecuador (Ecuador current corporate income tax is 23%).
US LLCs have been declared to be a preferential tax regime if owned by US non resident aliens and if income is not subject to federal income tax either at the entity level or that of its members. 
Preferential tax regimes are treated in the same manner as tax haven jurisdictions. As a consequence, dividends distributed to this type of entities will bear a 13% withholding at source and expenses from certain transactions between Ecuador and this regime may be disqualified as deductibles.
Furthermore, thin capitalization rules will apply to loans granted from US LLCs and transfer pricing regulations and compliance may be triggered.

Read more at: Tax Times blog

U.S./U.K. Treaty Does Not Override Code Requirements for Tax-Deferred Rollover

Office of Chief Counsel
Internal Revenue Service


Memorandum


Number: AM2008-009
Release Date: 8/29/2008


CC:INTL:B01:QPHuynh
PRENO-136253-08
UILC: 9114.03-42


date

: August 21, 2008

to

: Michael Julianelle

Director, Employee Plans
(Tax Exempt and Governmental Entities)


from

: Associate Chief Counsel (International)

subject

: UK Pension Rollovers

This memorandum addresses the possible application of Article 18 (Pension Schemes)
of the U.S.-U.K. income tax treaty to a rollover distribution from a U.K. pension scheme
to a U.S. retirement plan. This document may not be used or cited as precedent.
ISSUE
Whether an individual who is a resident of the United States may rely on the
parenthetical language in Article 18(1) of the U.S.-U.K. income tax treaty

1 (the “Treaty”)

to make a tax-deferred rollover distribution from a U.K. pension scheme to a U.S.
retirement plan in circumstances where the distribution would not qualify as an “eligible
rollover distribution” within the meaning of section 402(c)(4).

2

CONCLUSION
No. Nothing in Article 18(1) of the Treaty overrides the requirement that the distribution
must qualify as an “eligible rollover distribution” within the meaning of section 402(c)(4).
FACTS


1

Convention Between the Government of the United States of America and the Government of the United

Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with Respect to Taxes on Income and Capital Gains, signed on July 24, 2001, as
amended by a Protocol signed on July 19, 2002.


2 All references to “section” are to sections of the Internal Revenue Code of 1986, as amended.

Read more at: Tax Times blog

Jail & Big Fines for Undeclared Swiss Accounts!

Two former clients of UBS AG were sentenced on Monday to a year and a day in prison, matching what records show as the longest prison term ordered so far in a sprawling investigation of offshore tax avoidance involving the Swiss banking giant.

Sean and Nadia Roberts of Tehachapi, California, were also ordered to pay $3.2 million in restitution and fines, the U.S. Justice Department said. He is 77 years old and she is 64.
The couple pleaded guilty in 2011 to filing a false income tax return. From 2004 to 2008, they failed to report interest income from millions held in offshore accounts, falsely deducted bank transfers and under-reported income, prosecutors said.

One other former UBS client, Richard Werdiger, has received a prison term that long, according to an Internal Revenue Service-maintained list of UBS cases. Other clients have received a combination of probation, home confinement and fines.

The Robertses had requested probation, and their lawyer Nina Marino on Monday called the prison sentence "a travesty of justice" because of their age, restitution and other factors.

The sentence is likely to discourage restitution in future cases and reflects the Justice Department's "rigid and barbaric approach to these matters," Marino said.

Prosecutors asked the court to impose a two-year prison sentence because, according to court papers, the couple took steps to keep their offshore holdings secret after the investigation into UBS became publicly known.

The tax returns in question covered both individual income and the couple's income from two corporations they ran, a pilot-testing school and an aircraft-maintenance company.

If you have a Swiss Bank Account, contact the Tax Lawyers at Marini & Associates, P.A. for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free at 888-8TaxAid (888 882-9243).

For more information on this story go to Reuters

Read more at: Tax Times blog

IRS Continues Extreme Pressure on Swiss Banks for More Information

The US government is piling further pressure on Credit Suisse for the release of more information on its clients.

Switzerland's Finance Minister Eveline Widmer-Schlumpf says the US is 'constantly making new demands that we cannot accept', thus delaying resolution of their dispute over the prosecution of 11 Swiss banks.

If you have a Credit Suisse or other Swiss Bank Account , contact the Tax Lawyers at Marini & Associates, P.A. for a FREE Tax Consultation at www.TaxAid.us or www.TaxLaw.ms or Toll Free at 888-8TaxAid (888 882-9243). 

For more information on this story go to Reuters

Read more at: Tax Times blog

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