Monday, May 2, 2011

"Substantial Presence Test" for Worldwide Tax Liablility as Defined by IRS

Folks, this is hardly a newsflash but given that I've explained the Substantial Presence test probably 10 times in the past 7 days, I wanted to provide you with the IRS site link which explains it in pretty clear language.  There seems to be a lot of confusion out there!


Right now there is a small army of EB-5-promoting immigration attorneys who:



  1. Have their eye firmly set on the prize of a nice fat finder's fee AND

  2. Are conveniently hiding behide the "I'm just the immigration guy" facade.


As a result of this, I am getting a steady stream of affluent foreigners who've been recklessly steered toward an EB-5 permanent residency...a residency which will make them liable under U.S. law not only for their foreign earned income but for estate taxes AND capital gains realized abroad!  Talk about malpractice...


The link is below.  Read it and write me if you have questions.  The bottom line is this, take it for what it's worth: 3 out of 4 people who come to me thinking they want U.S. permanent residency as would-be EB-5 investors think otherwise as soon as I explain what it will mean to them financially.  The preferred option in most of these situations is to structure a non-immigrant visa platform which will let the investor and family reside in the U.S. but still permit the investor to plan his/her time in the U.S. carefully to insure that they do NOT establish "substantial presence"...and lose a fortune via poor tax planning.


Here it is:


IRS Test to Determine Worldwide Tax Liability



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