Registered: Jun 2008
08-15-12 10:59 AM
Quote from Nym:
People should be aware that foreign consulting companies like this advise primarily on how to form a company that will qualify and operate properly within the law of the foreign jurisdiction where you are forming the company (e.g Switzerland), but do not cover U.S. tax aspects.
This is well and good as far as it goes, but it does not go far enough and may be only the easy part.
For an American, your concern is equally going to be the treatment under U.S. law. These foreign consulting companies do not cover this adequately, if indeed at all.
For example, the U.S. will tax *you* (the U.S. owner of the foreign company) on the foreign income of the foreign company that you control. This is an extremely complex area that requires sophisticated U.S. tax and accounting planning, complex tax returns, elections etc. that the foreign firms do not advise on.
Unless you are prepared to also hire U.S. accountants and lawyers to advise on U.S. tax considerations, I would forget the whole thing. A casual approach is just going to get you in big trouble with the I.R.S.