The tax reform legislation passed at the end of 2017 is mostly neutral to beneficial for U.S. taxpayers living abroad. The one major exception applies to U.S. persons who own foreign corporations. Prior to the tax reform, profits from most foreign corporations were only taxable to the U.S. owner when paid out as a salary, bonus or dividend. Under the new legislation, two new taxes have been introduced:
-A one-time 2017 “repatriation tax” on previously untaxed profits of the foreign corporation.
-From 2018 tax year onward: an annual tax based on specially-calculated income of the foreign corporation called “Global Intangible Low-Taxed Income”.
If you are an owner of a foreign corporation (GmbH or AG in Switzerland) then please get in touch with us to discuss your potential tax and filing obligations. Advanced planning is crucial to avoid unnecessary tax and compliance costs.
Please see our flyer for more information and contact us to set up an appointment to discuss your situation.