Explanation of the GILTI Tax

Not sure what the GILTI tax is and why Monte Silver’s successful lawsuit is such a win for overseas American business owners? Then please read on as Monte has kindly explained what GILTI is and how it impacted overseas Americans:

Yesterday, Treasury issued the final regulation related to GILTI and the 50% GILTI-related deduction. The final regulation included 3 !!! significant and permanent wins for our advocacy!

1. The IRC 250 deduction is formally available to a taxpayer doing a 962 election.

2. The 962 election is retroactive to 2018, the first year that GILTI applied (new, not in the proposed regulations)

3. A company can make a 962 election in an amended return (new, not in the proposed regulations)

This is really dense stuff, so let me explain and provide a numerical example:

GILTI is a tax that was created in the Tax Cuts & Job Act. Its goal was justifiably to prevent Apple, Google and similar corporate Goliaths from abusively shifting profits from the US to low tax countries like Cayman Islands. To accomplish this, GILTI imposed a US tax on the US parent company for the annual profits of its foreign subsidiaries. The way that GILTI was structured is that GILTI tax would be due where the subsidiary was located in countries where the local corporate tax was less than 13.125%.

Unfortunately, the law caught about 200,000 small businesses in the same net. To make matters worse, until the final regulation was issued, small businesses paid higher GILTI tax rates than the corporate Goliaths. The numerical example below should help understand the problem and the relief. Until now, only the corporate Goliaths got the 50% deduction (in red below). Before the final regs (the numerical column on the left), a small business owner did not. As a result, not only did small businesses incur huge GILTI-related compliance costs, but at the end of the day they paid a higher tax rate than the Goliaths (25% compared to 20). Insane.

Under the permanent regulation (center numerical column), the playing field has been leveled. We and the corporate Goliaths are treated the same, and as long the corporation is incorporated in a country where the corporate tax rate we pay is at least 13.125%, then we will not own any GILTI.

In addition to the core relief, the permanent regulation also applies retroactively to 2018, and we can amend our 2018 return to take advantage of this benefit, to the extent we did not.

This is a major win. Small businesses are invisible to the federal government. And the fact that we accomplished this and other forms are relief from the Transition tax and GILTI is a testament to our combined voice and focused persistence.

This relief in no way makes the GILTI lawsuit moot. The GILTI lawsuit seeks to have small businesses 100% exempt from the GILTI tax – i.e. no need to comply each year, regardless of the tax rate of the country in which the corporation is incorporated.

To see the regulation, click here: https://www.silvercolaw.com/…/final-gilti-related-regulatio…

President Trump expands Hispanic Prosperity Initiative

The White House • July 9, 2020

 

President Trump just signed an executive order expanding the White House Hispanic Prosperity Initiative, which will help every member of our country’s proud Hispanic community prosper and achieve the American Dream.

The order will encourage pro-growth, pro-family, and pro-community policies such as school choice, personalized learning, family engagement, civic education, and more.

“Hispanic Americans are not only living the American Dream, but their incredible efforts are unlocking the American Dream for citizens all across our land,” President Trump says.

🎬 Watch: How President Trump’s executive order benefits the Hispanic community

Hispanic-American workers and families have thrived under President Trump’s agenda. Before the Coronavirus pandemic, the Hispanic unemployment rate reached a record low of 3.9 percent, and it remained under 5 percent for 23 consecutive months.

In 2018, the poverty rate for Hispanic Americans reached its lowest level on record, and since 2016, nearly 611,000 Hispanic Americans have been lifted out of poverty.

As the Coronavirus spread from China across the globe, President Trump worked tirelessly to ensure that all Americans could get back to work as quickly as possible. As a result, Hispanic employment increased by a sum of more than 2.1 million in May and June. This Administration won’t stop until every American is back on the job.

🎬 President Trump: We will never let public charter schools be taken away!

And with today’s actions, America will continue to be a land of opportunity for our incredible Hispanic community, as well as for every other American family.

School choice is a big part of that vision. Nearly one-third of all students in U.S. public charter schools are Hispanic. President Trump is expanding educational opportunities for these students and others, both with today’s executive order as well as through restoring local control and ending federal overreach in education more broadly.

Community development is another crucial component. Under President Trump, new jobs and investments have poured into nearly 9,000 designated “Opportunity Zones,” which together are home to more than 9 million Hispanic Americans.

President Trump is lifting up and empowering Hispanic Americans!

🎬 WATCH: “We’re a believer in choice”

The Left’s Cultural Revolution

Over Independence Day weekend, the mainstream media abandoned any last scrap of “objectivity” and went into overdrive to stir more division.

Rich Lowry zeroed in on what happened: “President Trump gave a speech that was very tough on the woke Left, while largely celebrating America — its Founders, its ideals and freedom, its capacity for self-renewal, its astonishing variety of geniuses, adventurers, warriors, inventors, and great musicians and athletes. Then, his speech ended, and the press piled on with one of its most its unhinged and dishonest performances of his presidency, which is saying something.”

The Wall Street Journal summed up the attacks against President Trump: “Progressives deride his defense of America’s founding principles.”

“Contrary to the media reporting, the America Mr. Trump described is one of genuine racial equality and diversity. He highlighted the central ideal of the Declaration of Independence that ‘all men are created equal.’”

So let’s review what was actually in President Trump’s speech. (Click here or the image below for video and/or transcript.)

President Trump said, “Our Founders launched not only a revolution in government, but a revolution in the pursuit of justice, equality, liberty, and prosperity. No nation has done more to advance the human condition than the United States of America and no people have done more to promote human progress than the citizens of our great nation.”

And President Trump went on to call out the left: “[T]here is a growing danger that threatens every blessing our ancestors fought so hard for, struggled, they bled to secure. Our nation is witnessing a merciless campaign to wipe out our history, defame our heroes, erase our values, and indoctrinate our children. Angry mobs are trying to tear down statues of our founders, deface our most sacred memorials, and unleash a wave of violent crime in our cities.”

As Byron York highlighted, “Trump specifically called out ‘cancel culture’ that is ‘alien to our culture and our values’ and is ‘a new far-left fascism that demands absolute allegiance.’ ‘This left-wing cultural revolution is designed to overthrow the American Revolution,’ Trump said. ‘In so doing, they would destroy the very civilization that rescued billions from poverty, disease, violence, and hunger, and that lifted humanity to new heights of achievement, discovery, and progress.’”

Make no mistake, the angry mob has taken over the Democrat Party. Potential Biden VP pick, Illinois Democrat Senator Tammy Duckworth made that clear Sunday when she said she was open to tearing down statues of George Washington.

Seriously. George Washington.

 

Bottom Line: While President Trump delivered a powerful call for unity at Mount Rushmore emphasizing how “the story of America unites us, inspires us, includes us all, and makes everyone free,” Joe Biden’s Democrat Party seeks to double down on making Americans ashamed of who we are.

Steve Guest
Rapid Response Director
Republican National Committee

Joe Biden’s memory fails him

When Joe Biden wasn’t fumbling through his answers to softball questions, he was “forgetting” his dismal track record on dealing with Russia and Vladimir Putin.

Let’s take a trip down memory lane:

Biden was a leading cheerleader for the failed Russia “reset,” a set of policies deemed to be such a failure, they were panned by Hillary Clinton who deliberately distanced herself from them as she prepared for her failed run for president.

In the Obama-Biden admin’s “first major foreign policy address,” Biden said, “It’s time to press the reset button” with Russia.

In March 2011, “Biden hailed the successful ‘reset’ of U.S.-Russian relations and reiterated his call for broader economic cooperation between the two countries.”

During the Obama/Biden administration, when the Russians engaged in a “sweeping and systemic” interference campaign in the United States Obama/Biden failed to act and “choked” in their handling of the Russian hacking, issuing only a “largely symbolic” and “modest” response.

As Bloomberg’s Eli Lake observed, this was part of a systemic problem with the Obama/Biden administration: “Why did Putin believe he could treat America like it was Estonia? The answer is that Obama spent the first six years of his presidency turning a blind eye to Russian aggression.”

On Obama/Biden’s watch, Russia also ran roughshod with the annexation of Crimea.

Furthermore, Biden himself has no shortage of hair-brained ideas on how to work with Vladimir Putin.

Ahead of the Iraq War, Biden tried to buy off Putin with the promise to give them oil money.

As The Federalist points out, Joe Biden has no ground to stand on to discuss another set of anonymous Russia related leaks: “Iran reportedly offered the Taliban $1,000 bounties in 2010 for American soldiers’ deaths in Afghanistan. Not only was no action taken by President Obama at the time, six years later, he authorized the payment of $1.7 billion to the regime.”

Bottom Line: One of the cognitive tests Biden should be taking is to recall how President Trump has consistently confronted Russia from leveling punishing sanctions to strengthening NATO. What the American people will see after an examination of Biden’s record is that he is full of hot air.

RNC Intervenes in Democrat Lawsuit to Protect Election Integrity in Florida

WASHINGTON – Today, the Republican National Committee, the National Republican Congressional Committee, and the Republican Party of Florida intervened in a radical lawsuit that Democrats brought in Florida as part of their nationwide assault on the integrity of our elections.

“Democrats never let a crisis go to waste, and they are using a pandemic to completely destroy the integrity of our elections. Their latest attempt to circumvent election law in Florida would allow paid operatives to go door-to-door to collect and deliver thousands of ballots, as well as allow votes to be counted after Election Day. This unnecessarily exposes Florida to potential fraud. Republicans will not sit on the sidelines while Democrats try to sue their way to victory in 2020 because they know they cannot beat President Trump in November.” – RNC Chairwoman Ronna McDaniel

“Democrats continue to try and use every trick in the book to unfairly tilt the election in their favor. The NRCC is proud to partner with the RNC and the Florida GOP to stop Democrats’ unconstitutional efforts to rob Floridians of their voting rights.” – NRCC Chairman Tom Emmer

“Once again national Democrats are coming into Florida trying to change our election laws by judicial fiat right before the 2020 election in an attempt to steal as many votes as possible in President Trump’s home state. We will do whatever we can to defeat this partisan lawsuit and ensure that every eligible voter in Florida has the opportunity to vote safely and securely.” – RPOF Chairman Joe Gruters

Democrats’ Election Power Grab in Florida:

This case is a prime example of Democrats and their liberal allies seeking to exploit coronavirus as an excuse to attack popular election integrity measures by asking judges to legislate from the bench. Democrats sued Florida and all 67 of its county supervisors of elections, demanding they willfully ignore and violate Florida election law by:

Prohibiting enforcement of the state’s ban on ballot harvesting. Despite their fear mongering over the dangers of voting in person in Wisconsin, Democrats are happy to facilitate the spread of coronavirus and jeopardize the integrity of the ballot through door-to-door ballot harvesting if it will help them politically.

Allow ballots to be counted after Election Day. By forcing the state to count ballots that arrive after Election Day, county election offices will be needed to verify ballots for weeks after the election, potentially delaying the outcome of the election and opening the door for fraud and unnecessary litigation. A recent Democrat-leaning survey showed that 83% of voters support a ballot receipt deadline of Election Day, and the RNC recently won a big victory at the U.S. Supreme Court, which denied Democrats’ attempts at allowing ballots to be cast and counted after Election Day.

The RNC’s intervention in Neilsen v. DeSantis comes on the heels of another recent legal victory in Florida, in which the party defended Florida’s longstanding ballot order law against a challenge by Democrats. As a result, President Trump will appear at the top of Florida’s ballot.

The RNC continues to fight back against the Democrats’ assault on the integrity of our elections by intervening in left-wing backed lawsuits across the country. On Wednesday, Chairwoman McDaniel demanded Nevada’s Attorney General investigate election chaos brought on by a similar Democrat lawsuit. Last week, the Pennsylvania Supreme Court handed us a big victory, throwing out a left-wing lawsuit to allow ballots to be counted after Election Day. Similar radical lawsuits are being fought in states like Michigan, New Mexico, and Arizona. The RNC recently doubled its legal budget to $20 million to fight these efforts, and you can learn more about them at www.ProtectTheVote.com.

The Trump Economy Benefits Historically-Disadvantaged Americans

February 20, 2020 / Read the original at: White House Articles

  The U.S. labor market is the strongest it has been in the last half century, as President Trump’s pro-growth economic policies continue boosting labor demand and lowering structural barriers to entering the labor market. Economic data presented in the 2020 Economic Report of the President, which was released today, show that recent labor market gains disproportionately benefit Americans who were previously left behind.

Since the 2016 election, the economy has added 7 million jobs, far exceeding the 2.0 million predicted by the Congressional Budget Office in its final pre-2016 election forecast. Under the Trump Administration, and for the first time on record, there are more job openings than unemployed people. In 2019, the U.S. unemployment rate has reached 3.5 percent, the lowest rate in five decades. Falling unemployment reduced the share of the population on unemployment insurance to the lowest level since recording began in 1967. Importantly, the African American unemployment rate has hit the lowest level on record, and series lows have also been matched or achieved for Asian Americans, Hispanic Americans, American Indians or Alaskan Natives, veterans, those without a high school degree, and persons with disabilities, among others.


Record-low unemployment rates are being set even as people are coming off the labor market’s sidelines. At the end of 2019, nearly three-quarters of people entering employment came from out of the labor force—the highest rate on record. And the prime-age labor force is growing under President Trump (+2.2 million), reversing losses under the prior administration’s expansion period (-1.5 million).

The Trump Administration’s policies are not only leading to more jobs but also to higher pay. While nominal wage growth for all private-sector workers has been at or above 3 percent for a year and a half, wage growth for many historically-disadvantaged groups is now higher than wage growth for more historically-advantaged groups—reversing trends observed over the Obama Administration’s expansion period, as shown in the figure below.

The benefits of a strong labor market are widespread. Net worth held by the bottom 50 percent of households has increased by 47 percent under President Trump—more than three times the rate of increase for the top 1 percent of households. To put these gains into perspective, the growth in wealth for the bottom half of households under the Trump Administration is roughly three times the Federal spending on Supplemental Nutrition Assistance Program (SNAP or food stamps) from 2017 through 2019.

Additionally, by promoting economic freedom, major deregulatory actions under the Trump Administration will further increase household incomes and lower inequality. Because of regulatory reform, the average American family will save $3,100 a year once recent reforms are fully in effect.

Rather than overregulating, the Trump Administration supports private-sector innovation and investment in the energy sector, which leads to tangible benefits for all Americans. For example, gains in shale drilling productivity have led to lower prices for natural gas, gasoline, electricity, and oil—saving the average American family of four $2,500 a year. Notably, shale-driven savings represent a much larger percentage of income for the poorest fifth of households (6.8 percent) than for the richest fifth (1.3 percent). This is the case with most instances of deregulation. For example, savings from deregulation of prescription drugs and internet access as a share of household income are eight times greater for the bottom fifth of households than for the top fifth.

A booming job market and more money in Americans’ pockets continue pulling people out of poverty and off means-tested welfare programs. Over the first two years of the Trump Administration, the number of people living in poverty decreased by about 2.5 million—including nearly 1 million children of single mothers—and the poverty rates for African Americans and Hispanic Americans are at record lows. Food insecurity has fallen, and there are nearly 7 million fewer people participating in SNAP than there were at the time of the 2016 election. The caseload for TANF has fallen by more than 900,000 individuals, and the number of individuals on Social Security Disability Insurance has fallen by almost 400,000 since the 2016 election. Similarly, Medicaid & CHIP enrollment reported by States is down by 3 million.

There are still barriers that prevent lower-income workers from realizing the full benefits of the strong labor market. The Trump Administration is reducing these barriers to both labor demand and supply by incentivizing private investment in disadvantaged areas through Opportunity Zones, making housing more affordable, and combatting the opioid crisis. Successful reforms in these areas will grow the economy by ensuring that all American households can benefit from strong, sustained economic growth.

Contrary to the discredited narrative that the Trump economy only benefits the rich, economic evidence confirms that the President’s policies allow historically-disadvantaged Americans to lift up themselves and their families. In other words, today’s economy is proof that pro-growth policies are the best way to deliver inclusive growth to Americans of all backgrounds.

Well-known FATCA opponent Mark Meadows is Trump’s new chief of staff

Congratulations to Congressman Mark Meadows who is named as President Trump’s new Chief of Staff. 9 million overseas Americans now have a friend in the White House who not only sponsored a House #FATCA repeal bill but also held a House FATCA hearing for them.

Mark Meadows, a Republican Party stalwart who introduced a bill aimed at repealing key elements of the Foreign Account Tax Compliance Act (FATCA) in September, 2016, has been named to replace Mick Mulvaney as chief of staff in President Trump’s administration. 

The news was immediately greeted by Republican expatriates as a sign that their voices might be heard more clearly by Republican policy-makers in the lead-up to this November’s presidential election.

Meadows, who represented North Carolina in the House of Representatives, had announced that he would not run for re-election to his seat. He will become Trump’s fourth chief of staff in 38 months, the most that any U.S. president has had in such a short time, according to U.S. press reports.

Read the full article at The American Expat Financial Journal.

10 Years On from FATCA

On March 18, 2010, President Obama signed the Foreign Account Tax Compliance Act into law. Surprising as it might now seem to some, the fact went virtually unnoticed by the world’s media, as the legislation was buried deep inside a domestic jobs bill known as The HIRE Act.

Read more here.

 

Promises Made, Promises Kept

President Trump made promises to the nation. Read here to see how he has kept them.

Congressman Holding to discuss TTFI in London on April 24, 2019

By Helen Burggraf

Republican Representative George Holding will discuss his recently-proposed Tax Fairness for Americans Abroad legislation in April, in a public forum for American expats in London that the organizers say they are hoping will build the solid cross-party consensus that Holding’s bill will need to be approved by Congress. 

The event, which will also include Republicans Overseas vice chairman and chief executive Solomon Yue, and Toronto-based lawyer and citizenship expert John Richardson, is expected to take place at a venue in Mayfair on April 24, from 6 to 7:30pm, a spokesperson for the Republican party told the American Expat Financial News Journal.George Holding cropped

Yue will also speak on “territorial taxation for individuals” (TTFI) in Athens during the week of May 6, again accompanied by Richardson, at a venue and time to be announced.

Read the full article here.