Excess Distribution Regime § 1291
What if a U.S. investor did not elect to have his investment in a Passive foreign investment company (PFIC) treated as a “Qualified Electing Fund” (QEF)? This seemingly small issue actually has huge financial consequences for the taxpayer. This paper will first explain what a Passive foreign investment company is and the liabilities of what that entails. Secondly, the what is an Excess Distribution Regime, and how this is a huge is advantage to the taxpayer. The Excessive Distribution regime is used when the qualified electing fund election was not elected in time. Then I will discuss what a qualified electing fund is and the benefits of electing it. Lastly what it is important for the taxpayer to make the
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What is an Excess Distribution Regime?
Excess distribution rules developed in an effort to prevent a reserve of passive income, within a foreign corporation, from sheltering U.S. taxation of a U.S. investor’s stack in the income (26 U.S.C. § 1291(b)). § 1291(b) defines “excess distribution” as “any distribution in respect of stock received during any taxable year to the extent such distribution does not exceed its ratable portion of the total excess distribution (if any) for such taxable year.”
In short, the purpose of the Excess Distribution Regime is to collect the tax that should have been paid on the income, as if it had been distributed currently, and the interest associated with that tax (26 U.S.C. § 1291). The interest collection is treated as § 6601 interest for the corresponding due date in that tax year (26 U.S.C. §1291(c)(3)(a)). Under excess distribution rules in §1291, tax liability arises only when a distribution is made or when the stock is directly or indirectly disposed
We started our research by reading through the discussions posted within the Topic of Research. From there we read the recommended pages of the text, 20-2, 20-3, and 20-4 regarding the liquidation process. Using the CCH Tax Research Network, we used a selected content search, Federal Tax--Federal Tax Editorial Content--Standard Federal Tax Reporter (2014), to research the following laws: Section 331(a), 336(a), and 6901(a). We also used the Citator in CCH to review the facts and decisions shown in the liquidation cases of Kennemer and Al Zuni of Arizona.
The purpose of this paper is to provide a summary of the article called “Can We Keep Our Promises?” by Robert D. Arnott, and to help better understand the three key risks facing each investor.
Sixteenth Amendment- Authorization of an Income Tax – Progressives thought this would slow down the rising wealth of the richest Americans by using a sliding or progressive scale where the wealthier would pay more into the system. In 1907, Roosevelt supported the tax but it took two years until his Successor, Taft endorsed the constitutional amendment for the tax. The Sixteenth Amendment was finally ratified by the states in 1913. The origin of the income tax came William J Bryan in 1894 to help redistribute wealth and then from Roosevelt and his dedication to reform of corporations. I agree with an income tax to pay for all of our government systems and departments, but I believe there was a misfire with “redistributing wealth.” The redistribution is seen in welfare systems whereby individuals receive money to live. This is meant to be a temporary assistance, but sadly, most that are in the system are stuck due to lack of assistance in learning how to escape poverty. There are a lot of government funded programs, but there is no general help system to help lift people up and stay up, so there continues a cycle of
The fact that majority of the capital funds was in the form of portfolio capital instead of foreign direct investment (FDI) had also worsen the situation. The ratio of portfolio capital to FDI had increased substantially from 1:1.3 in 1990 to 1:6.5 in 1993. Given the volatile nature, portfolio capital tends to respond with greater speed to changes in the environment.
Plunkett, Linda M., and Robert W. Rouse. "Revenue Recognition and the Bausch and Lomb Case." CPA Journal Sept. 1998: n. pag. CPA Journal. Web. 16 May 2014.
Meijer, Inc. was established in 1934 by founder Hendrik Meijer opened his first store in Greenville, Michigan, he opened his first grocery store in Michigan during the great depression. Meijer currently has 200 stores located in 6 Midwest states; with headquarters in Walker, Michigan. Starting as a simple grocery store, the company has grown into a big box superstore that combines grocery shopping with department store shopping in the same facility. Supercenters are becoming more popular, but Hendrik Meijer had the first of its kind. Transitioning from grocery to a supercenter was the ideal step, and the first in the industry to expand on the concept.
... Capital, Corporation Finance and the Theory of Investment", The American Economic Review, vol. 48, no. 3, pp. 261-297.
Adapted from the novella written by James M. Cain, Double Indemnity is a melodramatic film noir that highlights the conflict its characters face through adultery and murder which develops from the dissatisfaction and alienation that arose in the era of modernity as shown in most noir films. Unlike most noir films, Double Indemnity set the bar in terms of structural themes to follow and elements that eventually came to be considered essential in the noir genre. The film was seen to be a full embodiment of what the genre should be. Double Indemnity is an archetypal noir film, which portrays noir elements through its style, the characters, its writers’ backstory and the history of Los Angeles, the city in which it is set. This essay will examine how Los Angeles is integrated not only into the location but also into the storyline of the characters and their motivations but also the filmmakers’ lives. It does this through characteristic noir motifs like “the urban cultural landscape, the lack of rootedness of the characters, and the self-deceptions that center their world” (p. 437) affect the protagonists in the film. Double Indemnity’s use of Los Angeles as its primary location exposes the innate decadence and decay of the city through film noir stylistic elements. Billy Wilder directed Double Indemnity and the film became the archetypal noir film because it embodied all the characteristics of a typical noir film, which include “claustrophobia, paranoia, despair and nihilism” (Place and Peterson, p. 327) course kit source. Los Angeles, the city used primarily as the location in the film becomes not merely a backdrop but a character in the film through its physical and implied characteristics. The context through the stories of Wild...
Good morning/afternoon invited teacher and students. The expressive poem ‘Clancy of the Overflow’ written by the prominent poet Andrew Barton Paterson illustrates the country life of a drover as the ideal lifestyle as it is the beauty and nature of mankind. This poem is extremely critical of city life and seems to only convey the negative aspects that are involved. During this analysis various poetic techniques as well as aesthetic features will be used including suggestive language, alliteration, metaphor and imagery are applied to describe the author’s use of poetic devices and to show how effectively the poet conveyed its messages and the link to Australian diversity.
...ries where minority shareholders possesses the right to participate in significant decisions (Exxon Mobil 2013 10-K, 71)”. Furthermore, the accounting policies of Exxon Mobil indicate that there may be probable factors why “majority-owned investment is not controlled and henceforth must follow the accounting method. As for the corporation’s share of the ‘cumulative foreign exchange translation adjustment for equity method investments is reported in Accumulated Other Comprehensive Income’ (67).
William Sharpe, Gordon J. Alexander, Jeffrey W Bailey. Investments. Prentice Hall; 6 edition, October 20, 1998
Cumulative and Non-Cumulative – Cumulative shareholder are those shareholder who have right to get arrears of dividend for the year, in which business concern have not sufficient profit due to which it was unable to pay dividend to preference shareholders. For example if business concern has 20000, 9%, preference share and each share is 100 rupee and company did not pay dividend
Only Final Goods Ought to be Taxed, And Typically They Ought To be Taxed Uniformly:….
By expensing instead of capitalizing, AOL is able to derive a much larger tax benefit ($37,999 million instead of $20,714 million). The differential tax benefit can be written as:
...getting the stock are extending money but charging a higher percentage. This extra percentage would not be charged if earnings were reinvested which is internal.