Tax & Accounting Blog

Who Is a U.S. Citizen and Why It Matters: Part 5 – Documentation of U.S. or Non-U.S. Status

Who Is a U.S. Citizen and Why It Matters: Part 5 – Documentation of U.S. or Non-U.S. Status

To assist payments with the task of identifying U.S. persons (i.e., U.S. citizens, resident aliens, and U.S. entities), the IRS provides Form W-9 which, in addition to providing important information about a payee, may act as a certificate of U.S. status (unless the payer has reason to doubt the validity of the document). … Read More

Who Is a U.S. Citizen and Why It Matters: Part 4 – Loss of  U.S. Citizenship?

Who Is a U.S. Citizen and Why It Matters: Part 4 – Loss of U.S. Citizenship?

The 14th amendment also prevents U.S. citizenship from being involuntarily cancelled. Although Congress enumerated certain acts that shall lead to a loss of citizenship, the Supreme Court has held that the only way a U.S. citizen may expatriate is through his or her own voluntary and intentional actions of renunciation or abandonment. Section 349(a) of the … Read More

Who Is a U.S. Citizen and Why It Matters: Part 3 – Who Has U.S. Citizenship?

Who Is a U.S. Citizen and Why It Matters: Part 3 – Who Has U.S. Citizenship?

The 14th amendment to the Constitution of the United States confers U.S. citizenship status on individuals born or naturalized in the U.S. The Supreme Court has upheld the right of Congress to determine how citizenship is conferred to individuals not born or naturalized in the U.S. As a result, citizenship may be conferred by: 1) … Read More

IRS Makes Changes in Processing Central Withholding Agreements for Foreign Entertainers and Athletes

IRS Makes Changes in Processing Central Withholding Agreements for Foreign Entertainers and Athletes

Central Withholding Agreements (CWAs) are used by foreign athletes and entertainers who are planning a tour of the United States to arrange in advance an amount of U.S. income tax to be withheld on payments of income for events that are listed in the CWA, generally at a lower rate than would apply without a CWA. Read More

Who Is a U.S. Citizen and Why It Matters: Part 2 – Tax-Related Rules for Citizens

Who Is a U.S. Citizen and Why It Matters: Part 2 – Tax-Related Rules for Citizens

In order to apply the proper tax-related rules, payment professionals, tax advisors and return preparers need to know which employees, payees, or clients are U.S. citizens, and which are not and may, therefore, be subject to a different set of tax rules and procedures. Taxation of Worldwide Income. U.S. citizens are subject to U.S. income tax … Read More

IRS Revenue Ruling highlights expense payments which cannot be tax-free

IRS Revenue Ruling highlights expense payments which cannot be tax-free

Revenue Ruling 2012-25 from the Internal Revenue Service describes three plans which companies set up to provide expense reimbursements to employees, with the payments treated as outside of the wage stream and therefore paid without any tax deductions and not reported on the employees’ W-2 forms.  But under IRS scrutiny, all three plans failed the … Read More