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US citizens residing outside the US often find themselves helpless in the face of meeting their obligations to the US authorities. This becomes an even greater, more excruciating hurdle with the added difficulties imposed by the country of residence. In 2018, the EU passed a series of new regulations and directives concerning the stock market, … Read more
The new president is keeping up with his predecessor and putting more money into the market. Biden’s plan was passed by both houses thanks to the Democratic majority, and is predicted to be signed by the president on March 14th, a stimulus at the sum of $1.9T. According to the plan, any US citizen/resident that … Read more
In addition to annual tax reports and reports of global income, US citizens are obligated to file informative and declarative reports concerning their holdings of foreign entities according to preset criteria. Offshore company An offshore company’s owner or chief executives must disclose according to five categories. Each category requires disclosure and a statement regarding more … Read more
An inheritance tax is imposed on the net properties of a deceased person. A foreign citizen investing in the US must understand the significance of such exposure. Inheritance tax is applicable to any asset in the US, including shares and intangible assets. This means that even investments in the stock market with exposure to the … Read more
Section 1031 of the US tax code allows the deference of capital gains from the re-exchange of similar properties. The IRS had determined strict rules and conditions to prevent the abuse of this section. It is therefore best to use a qualified intermediary whose role is to prevent disruptions to the process. Section 1031 determines … Read more
The Israel-US tax treaty determines the tax fee and the order in which it is performed. Certain income of taxable in the US, and Israel has the right to charge the residual tax (the difference) whereas other income is taxable only in Israel, under certain conditions. Beyond the tax treaty, there are also Israel’s internal … Read more
A partnership is a pass through entity for tax purposes, meaning that profits/losses are channeled directly to the partners and they are the ones to be taxed. Thus partnerships avoid the double taxation (corporate tax + dividend tax) typical of corporations, yet still maintain the limited liability principle typical of corporations. Partnerships do not owe … Read more
Section 871 determines that the default taxation of income from rentals is FDAP and thereby owes fixed taxation at the rate of 30% of income, without the ability to file expanses. Your asset manager is responsible for this, and must deduct and pay the amount to the IRS. In this manner, the investor is not … Read more
In order to understand US tax policy, the Israeli investor must first understand the structure of the US government. The US is a federal presidential republic, a union of states that created a “super entity” to which they relinquished some of their governmental authorities. Each member of the federation has its own government and laws, … Read more
The US Social Security Administration is an independent federal entity responsible for social security, under the Social Security Act (1935). The SSA operates three social security plans: retirement benefits, survivor benefits and disability benefits. Social Security is funded by salary tax provisions by individuals throughout their period of employment. Only individuals who paid regularly over … Read more
