We get used to certain rules in the tax system and then think they HAVE to be there. But, often, that is not the case. I think the rules related to divorce are good examples.
Alimony is deductible by the payer and taxable to the recipient. This violates the “fruit of the tree” doctrine from the famous 1930 US Supreme Court case, Lucas v Earl.
Continuing with a recent theme in this blog – here is an update on federal legislation to not tax winnings of Olympic athletes. That is, the value of the medal and the cash from the U.S. Olympic Committee will be tax free. H.R. 5946 has now passed in the House and Senate, so will soon be off to the White House.
The IRS has stringent rules regarding taxpayers. In the case of using your business car for work, you must be able track everything perfectly. If you don’t, the IRS will not allow you to deduct expenses.
If you plan on deducting the miles you drive to attract and meet prospective clients, you would have to keep an accurate record of your travel. This would include:
An article from Stikeman Elliot includes the following:
For CRS purposes, the term ‘reportable person’ generally refers to a natural person or entity that is resident in a reportable jurisdiction (excluding Canada and the United States) under the tax laws of that jurisdiction, or an estate of an individual who was a resident of a reportable jurisdiction under the tax laws of that jurisdiction immediately before death, other than: (i) a corporation the stock of which is regularly traded on one or more established securities markets; (ii) any corporation that is a related entity of a corporation described in clause (i); (iii) a governmental entity; (iv) an international organization; (v) a central bank; or (vi) a financial institution. See definitional subsection ITA 270 (1).
I wrote a post on August 7, 2016 which discussed the August 5, 2016 decision of the United States Court of Appeals – District of Columbia Circuits in the Esher case. In this case, Justice Millet ruled that:
That extreme reading of the Totalization Agreement rests on nothing more than the Commissioner’s own say-so. It lacks any grounding in the Agreement’s text or in any principle governing the interpretation of international agreements. The tax court’s corresponding disregard of the Totalization Agreement’s textual direction concerning the role of French law in resolving undefined terms and in determining the content of the laws enumerated in Article 2(1)(b) was error and requires reversal.
Regulation 102 of the Income Tax Act (ITA) requires payroll withholding on income derived by virtue of employment. This applies to, say, a U.S. employer sending its employee to Canada to work on an assignment. Withholding would include income tax and contributions to the Canada Pension Plan (CPP) and Employment Insurance (EI).
On August 5, 2016 the United States Court of Appeals for the District of Columbia Circuits issued it’s decision in the Esher case.
This important case is: FRENCH TAXES US COURT REVERSAL 5 AUG 2016 (1)
Clifford Chance reports that “The Court of Justice of the European Union (CJEU) yesterday ruled that the EU fundamental freedoms preclude Member States from imposing withholding tax on interest paid to EU financial institutions, unless the financial institutions can claim a deduction for their financing costs and other expenses.”
The U.S. Commodity Futures Trading Commission (CFTC) announced that the U.S. District Court for the Middle District of Florida entered a final Judgment on June 28, 2016. Defendants Dorian Garcia and his companies, DG Wealth Management (DG Wealth), Macroquantum Capital LLC,UKUSA Currency Fund, and DG Wealth’s successor, Quanttra LP, all of Naples, Florida, are jointly ordered to pay restitution totaling $5,051,052 to defrauded investors victimized in a Ponzi scheme they operated from 2010 to 2015. The Judgment also requires the Defendants jointly to pay a $7.5 million civil monetary penalty and to disgorge $4,948,571 in ill-gotten gains.
Brian E. Andreoli is an international tax attorney and consultant in New York and focuses his practice on transfer pricing, international tax matters, and state tax matters. Mr. Andreoli has been a tax professional for more than 30 years, with experience in public, accounting, corporate (both foreign and domestic) law, and litigation.
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