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As a new year begins, we are forced to review the commitments and procedures that sustain us. overseas business.One of the most commonly used tools in the technology business framework is LLC (Limited Liability Company) America’s.
Brief description of outsourcing path
The acceleration of digitalization in recent years has resulted in Cross-border business Technology.Global service needs Software development, mobile technology, online sales, trading, digital marketing and programming It has grown exponentially in recent years and its growth curve is expected to be even steeper.
The trend, driven by corporate and government programs to promote computer tools, has given it a favorable reception locally. Equip professionals with skills that meet the standards required globally through continuous training on technology tools. Technical knowledge is extensive and implementation is relatively simple. On this premise, they advance through the contagion effect as if they were equal cases. If the project is the same, everything will work out the same way!
Therefore, a section of society, mainly young people, understand Your business can move abroad with dynamic and fundamental economic interests. A place where, although there may be no special measures to promote their activities, there are no obstacles to hinder the development of their business, which leads to extremely rapid growth.
Select destination: United States
established foreign company vehicles It was presented as an option for conducting activities abroad.Current offers and multiple offers presented in Digital Media Offers Soon there will be a society Can be used to pay for services abroad.This is how one of the most commonly used and promoted enterprise tools U.S. LLC. In addition to the tax benefits they offer, they have other aspects that make them the most popular option. Subjects residing outside the United Statesand those determined to expand their business into this jurisdiction.
In principle, they are Easy company registration, whose executive arm may consist of non-U.S. entities and all of its partners.Another important point is Opening a bank account is relatively simple.they can also be exempt from tax income tax, As long as there is no physical presence in the country, they offer a simplified receipt issuance system and, most importantly, they are very flexible in terms of management.
Is Argentina new to my overseas business?
Since the 2018 tax reform, Argentina’s tax regulations have changed, expanding international tax transparency system.
inside Art.Section 130 of the Income Tax Act The system is based on estimates of profits and expenses from foreign sources. Subsection e) relates specifically to profits derived by residents of the country from their income Involvement with foreign companies or other entitiesand provides that they will receive fees in proportion to their participation in the fiscal year ending in such fiscal year or such company’s annual fiscal year.
However, the most interesting thing about this article is in the second paragraph, which shows that the interpolation in question corresponds to When the vehicle does not have tax status. This concept has been incorporated into the Income Tax Act regulatory statutes. Article 288 of the above-mentioned Code provides that a company or any type of other entity registered abroad does not have a taxpayer personality if it is not regarded as a subject subject to tax liability by the tax legislation of that foreign jurisdiction similar to income tax. .
The purpose of this regulatory merger is to Directly to LLCIt not only has the particularity of a capital company, but also shows some characteristics of a company without personality.
For example, in the United States they are usually “transparent“.For federal tax purposes, an LLC may elect to be taxed as an LLC. entity,Is considered partnership or if there is a single partner, it will be deemed neglected entity. In the last two cases, No tax on income generated, because they tax the head of LLC partners. Therefore, as in this example, an Argentinian resident holding shares in a company that does not qualify for taxation must allocate income and expenses in proportion to his shareholding during the tax period corresponding to the closing of the foreign company or entity. distributes such profits to its partners.
Obligations of a U.S. LLC
The registration method of this type of company is very simple, and the management and operation are also very simple.This may result in breach of duty These entities are required in their jurisdiction of incorporation to provide registration commitments related to state fees and agents and to file reports with the Internal Revenue Service (IRS) as for tax return yearly.
In most cases, there are professionals from the United States who file the appropriate forms on time or request an extension of the deadline from the IRS. On the contrary, there is also a situation where the owner is completely unaware that a company registered in the United States is responsible to the IRS.This action resulted in total penalty When they mention violations by foreign investors, they often result in extremely onerous penalties.
In addition to a formal fine for failing to appear in court as required, federal tax returnand those related to international information statement.
Among them, one of the most severe penalties worth mentioning, which has attracted greater attention from the heads of US companies since the last regulatory changes, was announced on December 13, 2016, in which the Internal Revenue Service (IRS) Added new obligation CFR Section 1.6038A-1. These new changes came into effect on January 1, 2017, and now also affect all foreign-owned single member LLCs.This section covers Annual obligation to provide substantial information For foreign-owned entities, when the ownership of the non-U.S. person/entity is equal to or greater than 25% their votes.
As far as the sanctions themselves are concerned, the entity will be liable Annual non-compliance fine of $25,000 Submitting information within the required deadlines or failing to update records in a timely manner.
At the same time, as stated in paragraph 2 of point d) of Article 6083 of the Code, fines will also be imposed if any violation continues for more than 90 days after notification $25,000 every 30 days The violation continues after the 90-day period has expired.
As a final reflection on a brief description of the main characteristics and obligations limited liability company, not everything ends with simple online creation.We must consider both sides of the coin Profit Distribution A local perspective on foreign sources and their Annual Obligations and Significant Penalties Before the U.S. Treasury Department.
In addition, it is necessary to understand Current Automatic Financial Information Exchange Agreement The agreement signed by the two countries and its possible consequences for the residents of Argentina.
Consider also significant responsibilities, including formal obligations as a representative of a corporate entity before the IRS, compliance with annual tax or international information returns, and compliance with the FINCEN ultimate beneficiary regime from January 1, 2024. .
The implementation of any foreign entity should not be based solely on ease of registration, management or commercial image, but should be based on a broad understanding of international affairs and the accounting, legal and tax consequences that may arise from its choices.