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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 4186
Experience:  Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
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Have a us INDIVIDUAL who owns 50% of a foreign company. First

Resolved Question:

Have a us INDIVIDUAL who owns 50% of a foreign company. First year he files as a category 2 and 3 filer. If nothing changes in subsequent years does he still have to file as a category 3 filer or can he just complete cat 2 sections?
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

NPVAdvisor :

That is correct

NPVAdvisor :

Oly cat 2 is needed unless...

NPVAdvisor :

(only) ... nless...

NPVAdvisor :

acquires stock in a foreign corporation ...

NPVAdvisor :

acquires stock which, without regard to stock already owned on the date of acquisition, meets the 10% stock ownership requirement with respect to the foreign corporation .....

NPVAdvisor :

becomes a U.S. person while meeting the 10% stock ownership requirement with respect to the foreign corporation; or

NPVAdvisor :

disposes of sufficient stock in the foreign corporation to reduce his or her interest to less than the stock ownership requirement.

NPVAdvisor :

Otherwise, only insurance company stock ownership creates the need to re-file under 3

NPVAdvisor :

said differently, unless the company is an insurance company, something must change for cat 3 seciotn to be required

Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 4186
Experience: Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
Lane and other Tax Specialists are ready to help you
Expert:  Lane replied 1 year ago.

Thanks for the rating

As a follow-up, here's the IRS guidance.

http://www.justanswer.com/tax/7umu6-us-individual-owns-50-foreign-company-first.html


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If you'd like to work with ME again just say "For Lane only," at the beginning of your next question.


Thanks again,

Lane

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