Tax Analysts contains news, analysis, and commentary on international, U.S. state, and U.S. federal taxation aspects of residency and domicile for individuals, corporations, and passthrough entities, including taxation of wage, capital gains, investment, and business income; passive income such as dividends, rents, royalties, and interest; and sales tax and value-added tax. Residency often determines which jurisdictions may tax income, but the United States employs system under which its citizens and registered corporations are subject to income taxation regardless of their residency, known as worldwide tax system (as opposed to territorial taxation).
Tax Analysts provides guidance on how U.S. tax residency and domicile tax information are determined under the tax laws of international jurisdictions, the U.S. states, and the United States, including the substantial presence test under IRC section 7701(b) (26 U.S.C. 7701(b)). Recurring issues regarding residency determinations are individuals’ statuses as students or members of the military; expatriation by businesses and wealthy individuals to achieve tax savings (e.g., through inversions); when domicile has been abandoned; documentation of the time and activities of individuals in different jurisdictions; and information reporting obligations across jurisdictions, including for the purposes of the U.S. Foreign Bank Account Reporting Act (FBAR), and the Foreign Account Tax Compliance Act (FATCA).
Prominent recent events centered on the tax implications of residency include London Mayor Boris Johnson’s dispute with the IRS, record numbers of U.S. expatriations, and consideration of a territorial system of taxation for the United States.