Pearse Trust Blog

US Families Braced For Major Estate Tax Changes

Posted by Pearse Trust on Monday, Nov 14, 2016

A notice of proposed rulemaking issued by the United States Internal Revenue Service on 2  August 2016 has been described by one contributor to the ongoing debate as potentially the largest shake-up to US inheritance tax rules in 25 years.

Like many countries, the US taxes the transfer of assets from one person to another either by gift during their lifetime or by inheritance upon their death.

In 2016, transfers by an individual of an estate worth more than US$5.45m are subject to the estate tax, which has a top rate of 40%. This threshold is US$10.9m for married couples.

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Tags: Tax, USA

Trump vs Clinton – From Rhetoric to Reality

Posted by Pearse Trust on Wednesday, Sep 07, 2016

Donald Trump and Hillary Clinton don’t agree on very much, and their tax plans reflect their intentions to take America in two very different directions.

Yet, amid the verbal barbs of an increasingly acrimonious Trump vs Clinton election campaign, they do find some common ground on tax.

Unsurprisingly, both candidates claim that their respective policies are a recipe for economic growth. Also, both claim that their plans will reintroduce fairness into the tax system.

Yet, in the main, their proposals are predictably partisan. Ergo, Trump has proposed a substantial tax cut for entrepreneurs, while Clinton’s spending programs are paid for by increasing taxes on the wealthy.

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Tags: Tax, Guest Blogger, USA

New CbC Transfer Pricing Regulations for the US

Posted by Pearse Trust on Wednesday, Aug 17, 2016

Recently, the United States Treasury put a key piece in place in the BEPS jigsaw, by unveiling final country-by-country (CbC) transfer pricing reporting regulations for certain companies in the United States.

The OECD’s BEPS project is intended to give governments "comprehensive, coherent and coordinated" solutions for closing gaps that allow corporate profits to "disappear" or be artificially shifted to low- or no-tax jurisdictions.

The final package of recommendations is divided into 15 action areas, including new standards of transparency in the area of transfer pricing.

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Tags: Tax, USA, Anti-Money Laundering

FATCA’s Here, But Don’t Forget FBAR

Posted by Pearse Trust on Wednesday, Mar 16, 2016

Doubtless, most US expats and Americans with financial interests overseas are by now familiar with the extra reporting obligations imposed on them by FATCA. But there is another obligation they face, with an acronym in the world of foreign account reporting that is already long-established: the Report of Foreign Bank and Financial Accounts, or FBAR. And penalties for even minor infractions of this requirement can be severe.

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Tags: Legal, USA

Canadian Court Denies FATCA Challenge – Door Open For Appeal

Posted by Pearse Trust on Monday, Nov 23, 2015

On 16 September 2015, the Federal Court of Canada denied a request for an injunction to prevent the collection and disclosure of Foreign Account Tax Compliance Act (FATCA) information to the United States regarding American citizens living in Canada.

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Tags: Legal, Canada, USA

US Ruling Subjects Foreign Tax Credit Claims To Tax Shelter Test

Posted by Pearse Trust on Wednesday, Nov 18, 2015

In an opinion issued on 9 September 2015, the US Court of Appeals for the Second Circuit confirmed that the "economic substance doctrine" may apply to transactions involving foreign tax credits.

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Tags: Tax, USA

US Considers European-Style 'Innovation Box'

Posted by Pearse Trust on Wednesday, Oct 28, 2015

A discussion draft has been released on legislation to create a European-style "innovation box" regime in the United States, to encourage domestic investment in research and development (R&D).

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Tags: USA, Intellectual Property

US Tax Reform: Will It Happen?

Posted by Pearse Trust on Wednesday, May 06, 2015

Lawmakers across the political spectrum in the United States are generally agreed that the tax code is in need of an overhaul. A comprehensive tax reform plan that both parties in Congress can rally around is proving very elusive, however.

A Complex Code

It has been less than 30 years since the last major simplification of the tax code, and the National Taxpayer Advocate says that the total time burden of tax compliance has reached 6.1bn hours. That is the equivalent of approximately 3.05m employees working 40-hour weeks year-round with just two weeks off. The total cost of complying with the tax code is calculated at USD224.3bn a year.

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Tags: Legal, Tax, USA

Canada Challenges FATCA

Posted by Pearse Trust on Wednesday, Oct 08, 2014

In what appears to be the first challenge to the US Foreign Account Tax Compliance Act (“FATCA”), lawyers for Gwen Deegan of Toronto and Virginia Hillis of Windsor, Ontario say that FATCA exposes their clients 'to a deprivation of their liberty and security of the persons', in violation of Canadian Constitutional rights. FATCA applies to all “US persons”, which in itself is an expansive test and captures many groups of people that may not even realise they are “US persons".

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Tags: Legal, Tax, Canada, USA

FATCA – An Update For The UK & Ireland

Posted by Pearse Trust on Wednesday, Aug 27, 2014


Further to our previous blog on FATCA wherein we observed the postponement of the implementation dates for FATCA, the regime has now been implemented since July 2014.

Jurisdictions across the world are producing local legislation and guidance in order to implement FATCA on their home soil. 

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Tags: Ireland, Legal, United Kingdom, Tax, USA