Every year, it seems like more families and businesses face international tax issues. Some recognize this ahead of time and plan properly, while others find out after the fact and suffer the consequences. Here are four international tax issues that we think more individuals and businesses need to understand and address.
Estate planning considerationsAs more individuals and families grow across national boundaries, we’ve seen an increase in the need for cross-border estate and inheritance tax planning. Failure to plan before the occurrence of an event (like a relocation) can lead to increased costs and reduced planning options. Persons with interests in foreign estates and trusts also face complex compliance requirements. Failure to meet those requirements in a timely manner can result in severe penalties.
Strengthening U.S. dollar
The U.S. dollar strengthened significantly in the last year.
A stronger dollar can cause issues that individuals and businesses need to consider when planning for taxes.Fluctuations in exchange rates may create taxable gains or losses on transactions conducted in foreign currencies. Those fluctuations impact how you calculate your current taxable income if you’re doing business in a different currency.