Determine the right tax structure
entity choice & structure analysis
There is a myriad of ways to structure your business entity, including: C Corporation, S Corporation, Partnership, Limited Liability Company (LLC), Branch and Sole Proprietorship. Our team will analyze your company’s situation and advise you on the advantages and disadvantages of each option and provide a structure analysis.
The tax on income is the same as the regular corporate tax, except that an additional branch profits tax is imposed to equalize the tax treatment of a U.S. branch of a foreign corporation with the U.S. subsidiary of a foreign corporation. The dividend equivalent amount equals the branch’s earnings and profits effectively connected with a U.S. trade or business, reduced by any increase in U.S. net equity.
A significant disadvantage of establishing a branch is that a non-U.S. parent company becomes exposed to all of the liabilities of the U.S. branch, including the possibility of a full audit by the U.S. Internal Revenue Service.