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Archive for PFIC

PFIC And Canadian Mutual Funds – Part II

(This is a continuation from the article posted yesterday. Click here to read it.)

Ok, it is PFIC. So what?

In 1986, Congress added the PFIC rules to the Internal Revenue Code because of concerns that American taxpayers investing in passive assets indirectly through a foreign investment company have an inappropriate tax benefit compared to direct investments in these assets. The purpose of the PFIC rules was to eliminate this advantage. Read more

PFIC And Canadian Mutual Funds

Why are PFIC rules important for holders of Canadian mutual fund?

Many American citizens living or working in Canada have invested in Canadian mutual funds – likewise, many Canadians who subsequently moved to the United States retained their Canadian mutual funds holdings. They likely are unaware of the PFIC rules. Consequently many American taxpayers holding Canadian PFIC have not met their reporting obligations. Not only that  but PFIC investments are to be avoided since its taxation (with the exception of the QEF regime) is designed to be punitive. Read more

Final Regulations Clarify Exceptions To PFIC Reporting

Ephraim Moss, PFIC reporting

The IRS recently finalized regulations, previously in proposed and temporary form, which provide guidance on determining the ownership of a passive foreign investment company (PFIC) and the reporting obligations of PFIC owners. The final regulations make some changes to the proposed and temporary regulations based on comments that the IRS received from taxpayers and taxpayer organizations.

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No Uniform Treatment Of PFICs At The State Level

mary beth

Ownership by a U.S. citizen of foreign exchange traded (ETF) or mutual funds will most likely trigger the requirement to file a Form 8621. This is because the Internal Revenue Service (IRS) considers these investments as Passive Foreign Investment Companies (PFICs). The taxation of PFICs is incredibly complicated due to the various ways they can be taxed on the federal level.

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Last Opportunity To Register- May 12th 2016 Complimentary Webinar On PFIC- One CE Credit Earned


We only have a limited number of seats left in this free webinar! You will benefit from joining us on Thursday, May 12th 2016 at 1:00PM EDT/10:00AM PDT. If you have ever encountered the IRS Form 8621, you must join us to learn how you will cut away more Read more