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I have a New York SMLLC that is taxed as a corporation. The

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SMLLC's sole member is a...
I have a New York SMLLC that is taxed as a corporation. The SMLLC's sole member is a BVI (British Virgin Island Company). The purpose of the SMLLC is to hold a residential apartment and to rent it out. The question is whether form 5472 has to be filed with the corporate return or any other form related to the foreign ownership. Thank you.
Submitted: 1 year ago.Category: Tax
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9/14/2016
Tax Professional: Dr. Fiona Chen, Certified Public Accountant (CPA) replied 1 year ago
Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 482
Experience: Former IRS Revenue Agent
Verified

Dear Customer,

My name is***** will work on the question and get back to you, soon. I am reading your question and thinking about it.

Regards,

Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP

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Customer reply replied 1 year ago
Thank you.
Tax Professional: Dr. Fiona Chen, Certified Public Accountant (CPA) replied 1 year ago

Dear Customer,

You incorporate in one of the most complex states in the U.S. But other than the filing requirement of IRS 5474, I did not identify any other tax forms you need to file. It seems that IRS Form 5472 information is sufficient, mostly because you are a domestic, U.S. corporation. It is still recommended that you check with all the governmental entities on the reporting requirement.

It is assumed that you may have financial transactions with this foreign parent company. So the two forms below need to be paid attention.

Form 926

FINCEN Report 114

I also attached IRS website link on foreign exchange rate considerations, etc., for your booking of the transfer of gain and loss,

and IRS international investor visiting U.S. program

https://www.irs.gov/individuals/international-taxpayers/certain-taxpayers-related-to-foreign-corporations-must-file-form-5471

https://www.irs.gov/individuals/international-taxpayers/form-926-filing-requirement-for-us-transferors-of-property-to-a-foreign-corporation

https://www.irs.gov/individuals/international-taxpayers/miscellaneous-international-tax-issues

https://www.irs.gov/businesses/international-businesses/internal-revenue-service-international-visitors-program-ivp

https://www.irs.gov/individuals/international-taxpayers/foreign-currency-and-currency-exchange-rates

Please feel free to follow up.

Regards,

Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP

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Customer reply replied 1 year ago
Thank you for your response Fiona. The SMLLC has not given any funds to the BVI. The BVI though has given capital contributions to the SMLLC. Would this be reason to report anything? No dividends, etc have been issued.
Tax Professional: Dr. Fiona Chen, Certified Public Accountant (CPA) replied 1 year ago

Dear Customer,

When you register the company, you have disclosed all necessary information required by the corporation registration.

During tax filing, you would file Form 5472 as part of your full disclosure.

You will also be required to fill out the shareholder and percentage of ownership on the tax return. The tax form itself will ask about the foreign ownership.

When the subsidiary company receiving money from the shareholder, the parent company, it is assumed. That is the definition of ownership.

Regards,

Fiona

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Dr. Fiona Chen
Dr. Fiona Chen
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