2018 March/April EA Journal Exam

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Capitol Corner: Setting the Stage for 2018
By Justin Edwards

While 2017 was quite the roadshow spectacle in terms of the smattering of challenges and events enrolled agents encountered and should remember for years to come, NAEA continues to stand tall on behalf of the EA profession while powering its members.

Undisclosed Foreign Accounts, Protecting the Executor
By Frank Agostino, Esq., and Nicholas R. Karp, EA, USTCP

An executor administering an estate with undisclosed foreign accounts is exposed to substantial risks that may not be apparent. The following discussion is intended for executors and administrators who wish to understand and avoid those risks.

Taxation of Dividends from Foreign Corporation
By Athony Malik, EA

U.S. persons frequently own legal entities abroad to pursue a variety of economic interests. More often than not, these foreign entities default to corporate status à la the tax law’s default classification regime. This article will focus on U.S. shareholder taxation upon their access to these earnings in the form of cash dividends.

Tax Court Corner: Does a Tax Treaty Govern the Taxability of Unemployment Compensation?
Pei Fang Guo, Petitioner v. Commissioner of Internal Revenue, Respondent 149 T.C. No. 14
Filed October 2, 2017
By Steven R. Diamond, CPA

The United States has income tax treaties with many foreign countries. These treaties provide that residents of foreign countries may be taxed at a lower rate or may be exempt from U.S. taxes on income they receive from U.S. sources. These exemptions or reduced rates and specific sources of income vary among countries. The only question to be decided in this case is whether U.S.-source income from unemployment compensation is exempt from federal income tax under the United States–Canada income tax treaty.