If a U.S. resident makes a payment to a foreign resident, that payment may be subject to withholding at 30%. Although there are many provisions in the Internal Revenue Code that may reduce—or even eliminate—that withholding, those rules are extremely complex. Moreover, the failure to withhold will result in a tax liability for the U.S. payor which the IRS will try to collect. This program will detail the withholding rules and the exceptions so that U.S. payors of income to foreign persons will sleep better at night! 

Learning Objectives:

• Determine withholding on fixed, determinable, annual, or periodic (FDAP) income to foreign persons 


• Recall exceptions to the withholding rules


• Identify the procedure for withholding


• Calculate withholding for a U.S. purchaser of U.S. real estate and U.S. partnerships