U.S. Trade or Business: Defining the Undefined

Determining ECI, Withholding on Partnership Sales, 199A, Section 355 Spin-Offs, FDII Deduction

A live 110-minute CPE webinar with interactive Q&A

This program is included with the Strafford CPE Pass. Click for more information.
This program is included with the Strafford CPE+ Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Thursday, November 3, 2022

1:00pm-2:50pm EDT, 10:00am-11:50am PDT

Early Registration Discount Deadline, Friday, October 7, 2022

or call 1-800-926-7926

This webinar will attempt to define trade or business activities in an international context. Our expert panel of international tax professionals will cover how a trade or business designation affects U.S. income taxes, withholding, and reporting obligations and what taxpayer actions indicate a trade or business as determined by the courts and legislative history.

Description

The trade or business designation can be cost-effective or costly. A foreign person engaging in a U.S. trade or business generates effectively connected income (ECI). Although ECI is subject to U.S. taxation, deductions are allowed against gross ECI generated from U.S. sources. Most foreigners want to avoid U.S. taxation and U.S. filing obligations.

Section 199A(c)(1) defines qualified business income as "the net amount of qualified items of income, gain, deduction, and loss concerning any qualified trade or business of the taxpayer." For the FDII deduction, depreciable tangible property used in a trade or business is used to calculate qualified business asset investment (QBAI), a vital component of the FDII deduction calculation. For companies contemplating a Section 355 spin-off, Reg. Sec. 1.355-3 requires that "The distributing and the controlled corporations are each engaged in the active conduct of a trade or business immediately after the distribution" and for the five years preceding the distribution.

The term trade or business is found throughout the Internal Revenue Code but remains undefined. Whether a taxpayer operates a trade or business is generally a facts and circumstances determination often interpreted by the courts. The nature of activity and frequency of the activity both contribute toward the trade or business determination.

Listen as our authoritative panel of international tax experts reviews how the definition of trade or business affects the taxation of international taxpayers for tax advisers working with foreign taxpayers and businesses.

READ MORE

Outline

  1. Trade or business: introduction
  2. Effectively connected income
  3. Defining a trade or business activity
  4. Section 864(c)(8): partnership dispositions
  5. Deductions and trade of business status
    1. 199A
    2. FDII
  6. Section 355 spin-offs
  7. Transfer pricing
  8. Tax treaties
  9. Other areas
  10. Relevant cases

Benefits

The panel will cover these and other critical issues:

  • The facts and circumstances used by the courts to determine trade or business status
  • When the disposition of a partnership interest is subject to withholding under Section 864(c)(8)
  • How a trade or business determination affects the taxation of income in the U.S.
  • How to determine ECI

Faculty

Fuller, Pamela
Pamela A. Fuller, Esq., J.D., LL.M. (Taxation)

Senior Counsel (Tax, M&A, International)
Tully Rinckey PLLC and Zahn Law Group

Ms. Fuller’s practice has a triple focus: tax planning, tax controversies, and tax compliance. She advises a wide...  |  Read More

Additional faculty
to be announced.
Attend on November 3

Early Discount (through 10/07/22)

CPE credit processing is available for an additional fee of $39.
CPE processing must be ordered prior to the event. See NASBA details.

Cannot Attend November 3?

Early Discount (through 10/07/22)

CPE credit is not available on downloads.

Download