PFIC Compliance & Moving Outside US | International Tax Lawyer & Attorney Santa Monica LA
Hello and welcome to Sherayzen Law Office video blog. My name is Eugene Sherayzen and I’m an International tax attorney and owner of Sherayzen Law Office, Ltd.
Today, I’m continuing my series of vlogs from Santa Monica, California. The main theme of my vlog from Santa Monica is about US citizens moving to live outside of the United States. I’ve mentioned that there are special US International tax requirements that may apply to you as someone who is moving outside of the United States.
One of these topics that we need to discuss is a very complex US law concerning PFICs (passive foreign investment companies). PFICs is a unique law. I’ve dealt with clients from almost eighty countries and none of those eighty countries have laws similar to PFIC laws. Without getting into too much detail, basically a PFIC is an anti-deferral regime; meaning, that it is a disfavored type of investment. What is a PFIC? A PFIC is basically a foreign corporation that has passive assets which are in excess of 50% of their total assets or receipts of foreign income which is more than 75% of its total income. If 75% of its total income is passive income then it is considered to be a PFIC. The calculations are mind-boggling concerning default PFICs. There are many types of PFICs. Your tax compliance will be a lot more complex if you have them. If you move outside of the United States, a lot of times local financial advisors will advise you to into this mutual fund or that mutual fund or something else and in reality, these types of investments could get you into trouble.
If you would like to learn more about your PFIC compliance, you can contact me directly at (952) 500-8159 or you can email me at [email protected]
Thank you for watching, until the next time.
