Quote:
Originally posted by Giorgio_Xo
Avoidence is legal.
If you have an offshore company making offshore revenue and you have no immediate plans of repatriation of assets then the IRS can't do squat. The IRS in international matters has almost no power to enforce local laws so they push the idea on the news that hey can to scare people.
You have no requirement to pay taxes to one jurisdiction from profits made in another. U.S. Oil companies funnel billions of dollars every year into offshore corporations because they have no plans of bringing the money back to the U.S. This is legal.
It is in the IRS interest to gather as much revenue as possible whether they have a right to it or not.
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You might want to double-check those facts.
1. Residents are required to pay tax on their world income... so the issue of where the money is earned from is not that important.
2. As to where the money goes to (offshore)... there is the issue of "control".... ie who "controls" the offshore corporation. In Canada, if the person who controls the foreign corporation is a Canadian resident, then he (and his companies) are required to pay tax in Canada.
Canada and US have very similar tax laws in many areas.... I would suspect they would be similar in this area as the IRS doesn't want people to avoid paying tax on their world income by simply having the money land in another country.