27 July 2010, 9:34 am
let's think about this scenario : Joe is as US citizen ,he registered his online (e.g consulting) business offshore in a 0% tax haven jurisdiction (British Virgin Islands,Seychelles &Co),the company's cash is held in a bank account (offshore) under the name 'XYZ consulting' (corporate bank account), the company net income for the year is $120k and Joe pays himself a $40k/year salary.which he transfers to his personal bank account ,he concludes his business exclusively offshore (but lives in the US ) the US taxes worldwide income ,but what is considered in this case income , the 120k(company's net income) ? or the 40k(his salary) ? and if it's the $40k ,that money left under the company 's name ($80k) ,is it taxable under US law or not ? clarification or further information on this issue would be appreciated thank you in advance edit for tro : they are both worlwide income but one is corporate and one is personal ,what i want to know is which one is taxable byt the IRS in this case $120k or $40k ? tax lady I understand your point,I'am curious if is it going to be the same if we change the e.g here to drop shipping,you live in the US,you buy stuff from china and you sell them in europe under the XYZ compay name (registred offshore) ,is IRS going to tax the XYZ on this ? keep the same numbers $120k corporate income and Joe $40k salary what would be taxable ?... Read More »
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