Tax Services
Outbound Tax
A guide to the tax rules for US persons and businesses with income or holdings overseas.
Doing Business Abroad Doesn't Have to Mean Overpaying at Home
US tax law reaches income and holdings abroad in ways that catch a lot of people off guard — GILTI, Subpart F, and the foreign tax credit all come into play for anyone with foreign operations, subsidiaries, or investments. The rules get complicated fast, so it's worth talking through your specific situation with our team.
Making the most of foreign tax credits and available elections so double taxation stays minimal and every information return gets filed on time.
Key Things to Know
- How double taxation is relieved
- CFC filing basics
- Foreign account & asset reporting
Ready when you are
Operational Milestones
Map
The starting point is mapping every foreign entity, account, and income stream involved, then classifying each one for GILTI, Subpart F, PFIC, and foreign-tax-credit treatment.
Model
From there, the available elections — Section 962, the high-tax exclusion, check-the-box — get modeled out to find the structure that keeps the worldwide effective rate as low as possible.
File
Every US and information return gets prepared and filed on time — 5471, 8992, 8858, 926, FBAR, 8938 — with ongoing monitoring of your foreign footprint throughout the year.
Included Services & Outcomes
Worldwide Income Is Taxable, and Often Under-Reported
US persons owe tax on worldwide income, full stop. Owning a foreign corporation brings GILTI, Subpart F, and a stack of information returns into play — Forms 5471, 8992, 8858, and 926 — and missing even one of those filings carries a $10,000 penalty for that form, for that year.
Questions
Outbound Tax FAQ
What is GILTI, and could it apply to you?
Global Intangible Low-Taxed Income (GILTI) is a US tax on earnings from foreign corporations you control. Own 10% or more of a controlled foreign corporation, and GILTI tax is likely owed every year, whether or not the company ever distributes anything. Elections like Section 962 exist specifically to bring that rate down, and getting the calculation right is where a preparer earns their keep.
Does Form 5471 apply to me?
If you're a US person who owns 10% or more of a foreign corporation, the answer is usually yes, every year. Miss it and the penalty starts at $10,000 per form, per year, per entity, which is exactly why filing accurately and on time matters so much.
FBAR versus Form 8938: what's the actual difference?
Both exist to report foreign financial assets, but they go to different agencies with different thresholds. FBAR (FinCEN 114) covers foreign accounts over $10,000 and goes to the Treasury; Form 8938 (FATCA) covers a wider range of foreign assets, reported to the IRS at higher thresholds. Plenty of taxpayers end up owing both.
Is there a way around double taxation on foreign income?
Often, yes. The foreign tax credit lets US tax be offset by taxes already paid to a foreign government, and tax treaties can reduce or remove double taxation even further. Capturing every credit and treaty benefit available is exactly the kind of detail worth getting help with.
What if foreign forms went unfiled in past years?
The IRS runs streamlined and voluntary disclosure procedures built for taxpayers who fell behind on foreign reporting without meaning to. The right next step is assessing the exposure and figuring out which program fits, with the goal of getting compliant while keeping penalties as low as possible.
Resources
Outbound Tax insights
Have Foreign Income or Holdings to Sort Out?
Request a free consultation and we'll walk through your situation, quote a flat fee, and point out exactly what we'd approach differently.