Cross-border Transactions and International Tax
International transactions always involve important tax consequences that should be identified well in advance by U.S. tax counsel as well as foreign local counsel. U.S. businesses expanding abroad usually understand the value of getting thorough tax advice and of integrating this advice seamlessly into their business plan. However, foreign taxpayers wishing to invest or do business in the U.S. are often surprised by the complexity and reach of U.S. tax laws and may undervalue the importance of tax planning in their transactions.
Planning is necessary to assure hard-won gains are not lost to unintended tax consequences. It’s important this planning take place before early decisions like what form the business should take, and where management offices and employees might be located.
U.S. tax counsel should work fluidly with any tax treaties that may be involved, the Internal Revenue Code, and U.S. state and local tax. U.S. counsel should also know when the client needs advice from foreign local counsel, and can be instrumental in seeing that this advice is responsive to the client&rsquo s need.
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