Tax & Accounting Blog

New Cost Basis Rules May Be Lost on Many

New Cost Basis Rules May Be Lost on Many

With taxpayers in the throes of planning their 2011 income tax returns, now’s a good time to remind filers not to overlook new cost basis reporting rules governing securities sales. In the past, they had the option of specifying which shares they sold when computing their cost basis. But as of 2011, taxpayers’ account custodians … Read More

Treaty Exemptions for Business Profits – Part 5: A Fixed Place of Business

Treaty Exemptions for Business Profits – Part 5: A Fixed Place of Business

In order for an enterprise to have a fixed place of business, the place of business must be a building or physical location. The premises need not be owned or leased by the enterprise nor used exclusively by the enterprise. It is enough that the space is at the constant disposal of the enterprise. For … Read More

Treaty Exemptions for Business Profits – Part 4: Permanent Establishment

Treaty Exemptions for Business Profits – Part 4: Permanent Establishment

The definition of a permanent establishment may be found in the Permanent Establishment Article (typically article 5) of the applicable treaty. An enterprise has a permanent establishment if it has “a fixed place of business through which the enterprise carries on its business in whole or in part.” It may be a place of management, … Read More

Treaty Exemptions for Business Profits – Part 3: Treaty Exemptions from Withholding

Treaty Exemptions for Business Profits – Part 3: Treaty Exemptions from Withholding

A foreign entity may claim a treaty-based exemption from NRA withholding by submitting a Form W-8BEN with the treaty claim described in Part 2 and the income for which an exemption is being claimed described on line 10. To be valid, the Form W-8BEN must include the entity’s U.S. Employer Identification Number (EIN). An … Read More

Withholding on U.S. Business Income of Foreign Vendors – Part 4: Treaty Exempt ECI

Withholding on U.S. Business Income of Foreign Vendors – Part 4: Treaty Exempt ECI

A beneficial owner of ECI resident in a tax treaty country may be able to claim an exemption from tax under an applicable income tax treaty provision. An entity with ECI that is not attributable to a permanent establishment in the United States (as that term is defined by the applicable tax treaty), may make a … Read More