Question 1

The transfer of the assets of a U.S.corporation's foreign branch to a newly formed foreign corporation is always tax deferred under § 351.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements regarding income sourcing is not correct?

Accepted Answer

A)  U.S.persons benefit from earning low-tax foreign-source income.
B)  Foreign persons generally benefit from avoiding U.S.-source income classification.
C)  U.S.persons are not concerned with source of income because all their income is subject to U.S.tax under a worldwide system.
D)  Foreign persons may be subject to tax on U.S.-source income without regard to their actual presence in the United States.E) B) and D)
F) B) and C)

Question 3

Discuss the primary purposes of income tax treaties.

Accepted Answer

The primary purpose of an income tax tre...

Question 4

Olaf, a citizen of Norway with no trade or business activities in the United States, sells at a gain 200 shares of MicroShift, Inc., a U.S.company.The sale takes place through Olaf's broker in Oslo.How is this gain treated for U.S.tax purposes?

Accepted Answer

A)  It is foreign-source income subject to U.S.taxation.
B)  It is foreign-source income not subject to U.S.taxation.
C)  It is U.S.-source income subject to U.S.taxation.
D)  It is U.S.-source income exempt from U.S.taxation.E) A) and D)
F) A) and C)

Question 5

GreenCo, a domestic corporation, earns $25 million of taxable income from U.S.sources and $5 million of taxable income from foreign sources.What amount of taxable income does GreenCo report on its U.S.tax return?

Accepted Answer

A)  $30 million.
B)  $25 million.
C)  $30 million less any tax paid on U.S.income.
D)  $25 million less any tax paid on the foreign income.E) All of the above
F) A) and B)

Question 6

During 2012, Martina, an NRA, receives interest income of $50,000 from Collins, Inc., an unrelated U.S.corporation.Considering the following facts related to Collins' operations, what is the source of the interest income received by Martina?

Accepted Answer

Collins meets the 80% active foreign bus...

Question 7

Yvonne is a citizen of France and does not have permanent resident status in the United States.During the last three years she has spent a number of days in the United States.  Is Yvonne treated as a U.S.resident for the current year?

Accepted Answer

A)  No, because Yvonne is a citizen of France.
B)  No, because Yvonne was not present in the United States at least 183 days during the current year.
C)  No, because although Yvonne was present in the United States at least 31 days during the current year, she was not present at least 183 days in a single year during the current or prior two years.
D)  Yes, because Yvonne was present in the United States at least 31 days during the current year and 215 days during the current and prior two years (using the appropriate fractions for the prior years) .E) B) and C)
F) A) and D)

Question 8

Amber, Inc., a domestic corporation receives a $150,000 cash dividend from Starke, Ltd.Amber owns 15% of Starke.Starke's E & P is $2 million and it has paid foreign taxes of $1 million attributable to that E & P.What is Amber's foreign tax credit related to the Starke dividend?

Accepted Answer

A)  $200,000.
B)  $150,000.
C)  $100,000.
D)  $75,000.E) A) and B)
F) None of the above

Exam 25: Taxation of International Transactions

GreenCo, a domestic corporation, earns $25 million of taxable income from U.S.sources and $5 million of taxable income from foreign sources.What amount of taxable income does GreenCo report on its U.S.tax return?

Correct Answer
verified

Amber, Inc., a domestic corporation receives a $150,000 cash dividend from Starke, Ltd.Amber owns 15% of Starke.Starke's E & P is $2 million and it has paid foreign taxes of $1 million attributable to that E & P.What is Amber's foreign tax credit related to the Starke dividend?

Correct Answer
verified

Olaf, a citizen of Norway with no trade or business activities in the United States, sells at a gain 200 shares of MicroShift, Inc., a U.S.company.The sale takes place through Olaf's broker in Oslo.How is this gain treated for U.S.tax purposes?

Correct Answer
verified

Correct Answer
verified

Discuss the primary purposes of income tax treaties.

Correct Answer
verified
The primary purpose of an income tax tre...
View Answer

Which of the following statements regarding income sourcing is not correct?

Correct Answer
verified

The transfer of the assets of a U.S.corporation's foreign branch to a newly formed foreign corporation is always tax deferred under § 351.

Correct Answer
verified

During 2012, Martina, an NRA, receives interest income of $50,000 from Collins, Inc., an unrelated U.S.corporation.Considering the following facts related to Collins' operations, what is the source of the interest income received by Martina?

Correct Answer
verified
Collins meets the 80% active foreign bus...
View Answer

Exam 25: Taxation of International Transactions

GreenCo, a domestic corporation, earns $25 million of taxable income from U.S.sources and $5 million of taxable income from foreign sources.What amount of taxable income does GreenCo report on its U.S.tax return?

Correct AnswerverifiedShow Answer

Amber, Inc., a domestic corporation receives a $150,000 cash dividend from Starke, Ltd.Amber owns 15% of Starke.Starke's E & P is $2 million and it has paid foreign taxes of $1 million attributable to that E & P.What is Amber's foreign tax credit related to the Starke dividend?

Correct AnswerverifiedShow Answer

Olaf, a citizen of Norway with no trade or business activities in the United States, sells at a gain 200 shares of MicroShift, Inc., a U.S.company.The sale takes place through Olaf's broker in Oslo.How is this gain treated for U.S.tax purposes?

Correct AnswerverifiedShow Answer

Yvonne is a citizen of France and does not have permanent resident status in the United States.During the last three years she has spent a number of days in the United States. Is Yvonne treated as a U.S.resident for the current year?

Correct AnswerverifiedShow Answer

Discuss the primary purposes of income tax treaties.

Correct AnswerverifiedThe primary purpose of an income tax tre...View AnswerShow Answer

Which of the following statements regarding income sourcing is not correct?

Correct AnswerverifiedShow Answer

The transfer of the assets of a U.S.corporation's foreign branch to a newly formed foreign corporation is always tax deferred under § 351.

Correct AnswerverifiedShow Answer

During 2012, Martina, an NRA, receives interest income of $50,000 from Collins, Inc., an unrelated U.S.corporation.Considering the following facts related to Collins' operations, what is the source of the interest income received by Martina?

Correct AnswerverifiedCollins meets the 80% active foreign bus...View AnswerShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The primary purpose of an income tax tre...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Collins meets the 80% active foreign bus...
View Answer