A dividend distribution to a foreign parent of a US subsidiary would be taxed as US source income to the foreign parent. When a foreign business operates a branch in the US, the IRS imposes branch tax on the US branch profit in order to put the US branch on equal footing with a US subsidiary […]
Category: Nonresidents
Are Non-US Persons Liable for US Income Taxes?
The US generally taxes non-US Persons on “territorial income,” not “worldwide income.” Territorial income taxed by the US includes: Income effectively connected with a US trade or business (ECI), and US source income that is not effectively connected with US trade or business. Absent application of a superseding tax treaty, ECI, after allowable exclusions, exemptions […]
Read More… from Are Non-US Persons Liable for US Income Taxes?