Category: Puerto Rico

How Microsoft moves profits offshore to cut tax bill

SEATTLE — When someone in Seattle buys a copy of Office at a Microsoft Store, that cash doesn’t take the short route to the company’s area headquarters. Instead, after accounting for state taxes, the profit goes to a Microsoft sales subsidiary in Nevada. From there, much of that money begins...

How Microsoft moves profits offshore to cut its tax bill

Cash doesn’t flow directly from buyers’ pockets to Microsoft’s headquarters in Redmond, Wash. Instead, the company operates through three regional sales units, centered in Ireland, Singapore and Puerto Rico. These groups control the rights to profit from Microsoft products around the world. By conducting sales from places with small populations...

Walmart demand the government of Puerto Rico

The multinational has to file a legal complaint against the Secretary of the Treasury by the changes in its tax structure resulted Law 72 The Walmart Puerto Rico, Inc. corporation filed today in federal court in San Juan a legal action against the Finance Minister Juan Zaragoza, which challenges Law...

DAVIS: A refresher on foreign asset reporting requirements

Recently, the Internal Revenue Service announced the exchange of financial account information with certain foreign tax administrations as the next step in efforts to combat offshore tax evasion. This is a significant portion of the IRS’s efforts to enforce FATCA, the Foreign Account Tax Compliance Act, which was enacted in...

Microsoft, IRS spar over long-running probe of its taxes

The Redmond tech company and the Internal Revenue Service tangled in court Friday over the government’s audit of Microsoft’s software sales through offshore subsidiaries. Microsoft and the Internal Revenue Service sparred in court Friday over the agency’s power to investigate taxpayers. Microsoft, seeking a court order to overturn a portion...

Marco Rubio’s Billionaire Backer Likes to Sue Poor Countries and Put Profits in Tax Havens

Paul Singer has a good track record as a money manager. In 1995, he bought $20 million worth of Peruvian debt at a discounted price of $11.4 million, then forced Peru’s government, through lawsuits, to eventually pay nearly five times his initial investment — some $58 million. In 2002 and...

International Tax Reform May Still Be a Possibility; Treasury Focused on FATCA, PTPs

Tax Reform Still in Ryan’s Sights Despite Boehner’s Departure Last week, following the sudden announcement by House Speaker John Boehner (R-OH) that he would be stepping down from Congress at the end of October, House Ways and Means Committee Chairman Paul Ryan (R-WI) and various other Committee members quickly confirmed...

Transfer pricing audits: flipping the tested party

Introduction Transfer pricing methods and tested parties Troubling trend Tools for taxpayers Introduction In some recent transfer pricing audits the Internal Revenue Service (IRS) has ‘flipped the tested party’ after examining transactions between related US and foreign companies. Typically, this practice results in the attribution of a larger portion of...

Tax Alert: New Deadline for FBAR Filing

Due to a little-noticed provision in the new highway appropriations bill signed into law on July 31 – the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 – the deadline for filing an FBAR (Report of Financial Bank and Financial Accounts) has been moved up from June...

Multinationals should be made to pass “common sense” test on where they get taxed

The Australian Taxation Office should be given the power to ignore multinational transactions that fail to pass the “common sense test” and ensure that technology company profits are taxed where they are earned, the Australia Institute submission to the inquiry into corporate tax avoidance says. The submission takes a swipe...

New tax incentives draw investors to Puerto Rico as middle class continues flight from island

As middle class flees, Puerto Rico tries luring rich people The towering 38-year-old native of Arkansas is one of at least 250 people who’ve accepted Puerto Rico’s invitation to well-heeled U.S. citizens to move to the island and enjoy life without taxes on capital gains, an enticing offer for those...

Puerto Rico Expands Tax Haven Deal For Americans To Its Own Emigrants

Puerto Rico’s Acts 20 & 22, tax incentive laws aimed at luring wealthy American investors to move there and at reviving the Island’s economy, are celebrating their third anniversary this month. While Puerto Rico’s economic situation remains bleak (it currently has more than $73 billion of “junk” status debt, unemployment...

IRS Sues Microsoft in Fight Over Records on Intangibles, Cost Sharing

Dec. 15— The Internal Revenue Service filed a petition in U.S. district court to enforce a summons against Microsoft Corp. to produce “books, records, papers and other data” related to the pricing of intangibles under two cost-sharing arrangements (United States v. Microsoft Corp., W.D. Wash., No. 2:14-mc-00117, petition filed 12/11/14)....

Global tax war looming and US won’t be backing down

The United States won’t give up its right to tax multinationals, and nations will go to war soon with countries like China on taxing rights, a US tax head says. Grant Thornton’s national managing partner of tax in the United States, Randy Robason, is in Australia this week for a...

Microsoft to pay China $140 million for ‘tax evasion’

(Reuters) – China has levied about $140 million in back taxes from Microsoft Corp in the first major case concerning cross-border tax evasion in the country, as regulators ramp up pressure on U.S. corporations doing business there. According to an article published by China’s Xinhua official news agency on Sunday,...

Whopper? Microsoft Skirts Billions In Taxes, Google, HP & Apple Have It Their Way Too

With all the talk about inversions and America’s Burger King Going Canadian, it’s easy to ignore even more prevalent tax savings by numerous American companies. Take Microsoft, which admits in its 2014 SEC filing that it avoids $30 billion in U.S. taxes. The trick? Keep about triple that amount, $93...

Microsoft has nearly $93 billion in overseas cash, and it’s reduced its tax bill by almost $30 billion

Microsoft’s stash of cash stored overseas, not subject to US taxes, is growing. In its latest regulatory filing, the software giant said it has now stockpiled $92.9 billion offshore and that this money could have cost the company $29.6 billion in taxes, but didn’t. That compares to $76.4 billion from...

Puerto Rico, an American Tax Haven

Back in 2012, the Puerto Rican government signed a law that created a nice tax haven of U.S. citizens. Tax attorney Rob Wood comments on the Puerto Rican option, which was also the subject of his Forbes article “Hate Taxes? Move To Tax-Free Puerto Rico, Stay American, Avoid IRS.” Wood...