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Multijurisdictional tax (Inbound taxation and Outbound taxation assignment)
Finance & Accounting
Pages 12 (3012 words)
TX 604 Spring 2013 Assignment 4 Inbound & Outbound Due Date: April 15th @4:00pm Email to firstname.lastname@example.org Inbound Taxation Please read the following fact patterns and answer the questions that follow. John Doe, Flick’s tax director has contacted you. Some of the officers of one of Flick’s foreign subsidiaries have been calling him to ask a variety of US tax questions based on their (the officers – not the subsidiary) increased activity in the US.
IBM Corporation pays a regular quarterly dividend on the stock. Your previous research concluded that Joe T. is a nonresident alien of the US. 1. Is the income received US source income or foreign source income? What statute did you rely on for your conclusion(s)? Facts Joe T. is a non resident alien of the United States who has invested in 1,000 shares of common stock in IBM Corporation. IBM is registered in Delaware, United States and does most of its business within the United States. The stock owned by Joe T. represents less than 1% of the overall value of IBM Corporation. Interpretation Joe T. is a non resident alien in the United States which means that Joe T.’s income derived from sourced within the United States are liable to taxation. Since IBM Corporation executes most of its business from within the United States, so under Sections 861(a)(2) and 862(a)(2), the dividends released by such businesses are considered as income being derived from within the United States. ...
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