Many tax practitioners have clients residing or working in the United States who are not U.S. citizens, or individuals who are are working outside the United States. Some clients may own or control foreign corporations which conduct business throughout the world. These clients face complex issues that the practitioner must recognize and address, such as the tax consequences of:

• Taxation and withholding of foreign nationals working in the United States, including entertainers, performers, attorneys and other professionals
• Taxation and withholding of foreign nationals investing in the United States
• Taxation of U. S. citizens and residents living and investing in foreign countries
• Taxation of professionals working in several states or countries, including athletes, musicians, entertainers and artists
• Taxation of U. S. shareholders who own controlled foreign corporations
• Foreign Sales Corporations and Interest Charge DISC Corporations
• Transactions between the client and its foreign related party (see Transfer Pricing)
• Foreign Tax Credit issues
• Transfers to or from a foreign trust
• Gifts received from a foreign source

We'll advise you on the applicability of tax treaties as they relate to your client's specific tax issues. Mitchel Zuniga & Smith will render advice regarding any tax issue or financial transaction with international aspects or implications. Our specialists also accept speaking engagements to your business or professional group regarding any international tax issue.

Transfer Pricing

Since 1990, many substantive changes to the pricing regulations under Section 482, reporting requirements under Section 6038A and penalty applications to pricing adjustments under Section 6662 have placed an enormous burden on the foreign controlled subsidiary.

The increased instances of a transfer pricing audit and the addition of multiple reporting requirements leave the inexperienced practitioner and client at great risk.

Compliance with Section 482, in almost all instances, requires the use of comparable independent company data to measure whether transactions between controlled related parties are conducted at this standard. Based on our results, we'll issue a report recommending the client's most appropriate pricing method and the required documentation for reporting purposes.

In many cases, we are able to recommend a more practical way for smaller companies to maintain information that will satisfy their record keeping requirement without incurring the expense of obtaining exhaustive research on comparables they may not need.

Our specialists assist the client by identifying information already in their possession that will prove to be more useful in an IRS examination. Our studies are aggressively priced in comparison to many studies performed by the Big 5 CPA firms.

The transfer pricing study is also used when seeking an Advanced Pricing Agreement (APA) with the IRS or foreign governments. APA's are obtained through a formal inquiry and negotiation process. Our specialists have the experience to lead the client through the APA process. Let Mitchel Zuniga & Smith be your Transfer Pricing Specialist. If your client faces an IRS transfer pricing examination, you should have us in your corner. We have prepared many transfer pricing studies for IRS Appeals and United States Tax Court support work. Mitchel Zuniga & Smith has proven invaluable to many attorneys and CPAs needing an experienced eye to review the IRS reports and supporting workpapers for any weaknesses.

Additionally, since we have a broad range of experience in state tax issues, we can advise the client on how transfer pricing decisions are impacted by state tax law.