The US has been the world’s largest recipient of Foreign Direct Investment (FDI) since 2006. In particular, Latin countries, such as Spain and Mexico are establishing new operations in the US or are providing additional capital to established businesses. These foreign businesses know the US has the world’s largest consumer market, skilled workers and a predictable regulatory environment. What they don’t know is how to maneuver through it. Not only are the US’s legal, accounting and tax laws different than in their own countries, but our culture varies greatly. During the first few years, employee turnover is high as workers struggle to adjust to new accounting systems, reporting techniques etc.
Foreign business owners, as well as their US based staff, are searching for solutions to their unique problems. They need an advisor they can connect with to resolve their issues. The ability to understand their business culture and speak a second language has been my greatest attribute when working with our foreign clients. In general, the most pressing issues facing foreign owned companies that I have been able to assist with are:
- Structuring the right US business entity and activities
- US tax filing requirements: national, state and local levels
- Other potential tax liabilities: Transfer pricing and documentation, sales and use tax
- Gathering a team of experts to help them – banker, attorney, insurance agent, etc.
- Helping them understand how US accounting and tax systems work
- International tax planning
- Being the liaison between the corporate foreign owners and the US based staff
- Utilizing US and foreign country treaties to their advantage
- The ins and outs of international business etiquette
We have seen an influx of foreign investors buying US businesses and property and without the correct tax and accounting advice it can be a struggle to become compliant with US laws and regulations. For more information contact your LSL Advisor.
