Contact UsMy business partner wants to avoid double taxation, meaning paying taxes here in the US and Spain. I'm a U.S. Citizen, she is not.
My business partner and I want to open an LLC (50/50), she lives in Spain and I live here in Las Vegas Nevada. Our business is an Online Marketplace. Since she is not a resident, or American citizen, she is a Spanish citizen.
Does she need to pay taxes in the US and Spain?
Any possibility to only pay here in the US, or only in Spain and avoid double taxation?
What are the possibilities for her side to avoid double taxation?
Thanks,
Does she need to pay taxes in the US and Spain?
Any possibility to only pay here in the US, or only in Spain and avoid double taxation?
What are the possibilities for her side to avoid double taxation?
Thanks,
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Tax Professional Answers
John Stancil
My first response is to wait for the Trump tax bill to pass. One of the features of his proposal is to eliminate worldwide taxation in the United States.
Assuming that the LLC is chartered in the United States, the question becomes "it the income considered effectively connected to the United States?" Since you are operating through a US LLC, the income would normally be considered effectively connected. SInce the LLC is a pass through entity, it is required to withhold 30% of her share of the gross income as tax withholding. There is a foreign tax credit available to alleviate the effects of double taxation.
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377 weeks ago
Assuming that the LLC is chartered in the United States, the question becomes "it the income considered effectively connected to the United States?" Since you are operating through a US LLC, the income would normally be considered effectively connected. SInce the LLC is a pass through entity, it is required to withhold 30% of her share of the gross income as tax withholding. There is a foreign tax credit available to alleviate the effects of double taxation.
Question Owner
You are making a valid point about Trump.
Yes, the LLC will be here in Las Vegas, I live here as well. She will be in Spain will not move to Las Vegas. So when taxation time comes 30% will be taken of her share. Will that happen to me as well?
Is LLC taxed as a person and not a business? I mean, I learned to not leave all the eggs in one basket. Sorry for all the questions, taxes is just complicated :)
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377 weeks ago
Yes, the LLC will be here in Las Vegas, I live here as well. She will be in Spain will not move to Las Vegas. So when taxation time comes 30% will be taken of her share. Will that happen to me as well?
Is LLC taxed as a person and not a business? I mean, I learned to not leave all the eggs in one basket. Sorry for all the questions, taxes is just complicated :)