States with the lowest income tax rate in the USA?

In the United States, income taxes are levied by both the federal government and individual states. The federal income tax is a progressive tax, which means that the tax rate increases as the taxable income increases. The federal government uses the tax revenue to fund various programs and services, such as national defense, healthcare, and […]

• February 4, 2025

How does Import Duty work in the United States of America?

When you export goods to another country, you must know the import duty in the importing country, if any, imposed on the products you are exporting. The cost of goods includes the purchase price, logistics costs, and import duty. Generally, when looking at the cost, the term is “what is the landed cost?” of the […]

• December 1, 2024

How is a Capital Gain Taxed in the United States?

The amount of income tax you pay on your Capital gain could be different if it is taxed in Canada and the United States. In the United States, taxation rules when computing and reporting the taxable amount of capital gains on your income tax return and the applicable capital gain tax rate are different than […]

• November 30, 2024

25% Foreign Ownership reporting obligation

Do you know, as a Canadian resident, what your reporting obligations are if you are doing business in the United States through a corporation either incorporated in Canada or you have incorporated in the United States? All Canadian residents who directly or indirectly own 25% or more ownership in a Corporation incorporated in the United […]

• November 22, 2024

What is BOIR reporting in the United States of America?

Are you the owner of an entity that is incorporated or registered in the United States of America?  Are you controlling the entity directly or indirectly, either 25% or more? You may be obligated to report BOIR. BOIR is the Beneficial Ownership Information Reporting is required under the Corporate Transparency Act by certain types of […]

• November 18, 2024

What is a Registered Agent service in the United States?

Do you need to appoint a registered agent in the United States when you are incorporating your business? Can you appoint yourself as a registered agent? What does a registered agent do? There are various questions frequently asked and in most cases we have seen that the client is unaware of this matter. Let’s look […]

• March 31, 2024

What is the reporting under the Foreign Account Tax Compliance Act (FATCA)?

The Foreign Account Tax Compliance Act (FATCA) is a U.S. tax law enacted in 2010 to prevent tax evasion by U.S. taxpayers who hold assets in foreign financial institutions. FATCA requires foreign financial institutions (FFIs) to report information about financial accounts held by U.S. taxpayers to the Internal Revenue Service (IRS).   Under FATCA, FFIs […]

• March 13, 2024

Collecting sales tax in New Jersey – (Nexus and other details)

Sales tax obligations that may apply to a remote sellers or sellers on Amazon, Ebay, or Sopify, etc.  With the evolution of online sellers, the sales tax rules of the states in the United State have completely changed. Most of the states in the United States are now requring sellers to pay and file a […]

• December 31, 2023

What is an LLC in the United States?

An LLC is a separate legal entity. LLC stands for a Limited Liability Corporation in the United States. A separate legal entity means an entity (similar to an individual for legal purposes), which has its own registered name, has its own tax identification number, files and pays taxes in its own name. This entity can […]

US tax filing deadlines, automatic extensions.

Generally, you need to file your income tax returns in the United States by the due dates; otherwise, a penalty or interest may apply. In certain reporting circumstances these penalties can be huge. If you can not file your income tax return on time you can request IRS for an extension. If you are a […]

• December 30, 2023

Paid tax preparer’s obligations in the USA?

Do you want to know what are the obligations of your accountant who is preparing and filing your income tax returns?   You do not need to be an expert or follow some IRS guidelines when you are filing your income tax return yourself. However, if you are filing taxes for others as a paid […]

• December 22, 2023

Texas – extremely low business taxes as compared to most states in the United States

Do you know that Texas is considered the second-largest economy in the United States? The majority of the revenues in this state come from the gas and oil industry, steel, farming, and tourism. Texas promotes business startups by reducing business taxes up to zero percent when their revenues do not exceed a certain threshold. At […]

• December 7, 2023

Qualified Business Income (QBI) Deduction can reduce your income tax payable

Claiming a deduction your income tax return reduces your taxable income and you pay lower income tax on your taxable income. You may qualify for Qualified Business Income (QBI) Deduction which reduces your taxable income up to 20%.   Qualified Business Income (QBI) Deduction Summary This is also known as Section 199A deduction If you […]

• November 28, 2023

Do you know? The State requirements for starting a company in Nevada, USA

One of the most important benefits of incorporating is limited liability protection. As opposed to Canada, where you can incorporate Federally, but this option is not available in the United States. You can only incorporate at the state level. Now, choosing a particular state in which you want to incorporate depends on various factors, and […]

• November 17, 2023

“C” Corporation in the United States: Advantages, Disadvantages, and Taxation you may want to know.

Learn about “C” corporations in the United States, their advantages and disadvantages, and how they are taxed. Read on to make an informed decision about forming a “C” corporation. Are you looking to form a corporation in the United States but not sure what type of entity to choose? A “C” corporation is one option […]

• March 31, 2023

If you are not able to file your tax return on time, what options do you have to minimize the interest and IRS penalties?

If my client is unable to file their income tax return by the due date, I advice them to request an extension of time to file their return. Individual taxpayers can request an automatic extension of time to file by filing IRS Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income […]

• March 17, 2023

Do You Want to Incorporate in Delaware? Learn About the Benefits, Steps, and Considerations.

Incorporating in Delaware: Benefits, Steps, and Considerations   This is the most famous state in the United States for forming an LLC or incorporating a business by a foreign person. One of the most important benefits of incorporating in Delaware is that the ease of doing business, maintaining a foreign address, and the government and […]

• March 3, 2023

When Do You Need to File a U.S. Tax Return? Learn About Income Thresholds and Filing Requirements.

Do You Need to File a U.S. Tax Return? Understanding Income Thresholds and Filing Requirements   In the United States, individuals must file a federal income tax return with the Internal Revenue Service (IRS) if their income meets certain thresholds. The filing requirements can change from year to year, so it’s important to check the […]

• March 2, 2023

How Will the United States Inflation Reduction Act of 2022 Affect Your Taxes?

The United States Inflation Reduction Act of 2022: Potential Tax Implications for Individuals and Businesses   The world is progressing towards green energy, clean energy, save energy, and a pollution free environment. The entire effort is directed to save our planet for our children and the future generation. The governments of the countries in the […]

• December 12, 2022

New York – sales and use tax regulations

New York has a sales tax rate of 4% at the state level. However, local governments within the state are allowed to collect sales tax up to 4.875%. There are 987 local tax jurisdictions in New York, and the average rate of sales tax amounts to 4.23%. The highest sales tax rate amounts to 8.75% […]

• December 3, 2022

Individual’s tax filing status – do you have a choice to select your tax filing status?

You may have choices when determining your filing status than just one being selected as married or single. A taxpayer may be eligible for more than one filing status. As you prepare for the forthcoming tax filing season, a taxpayer should review his/her options to select the filing status that is the most applicable to […]

• November 30, 2022

Do you deal in Cryptocurrency – you may want to know the taxation rules in the United States.

What is virtual Cryptocurrency? Cryptocurrency is also a familiar virtual currency in most countries of the world. Now the question is, what is virtual currency? In this discussion, we have used cryptocurrency or virtual currency and has considered that both are the same. It’s a digital representation of monetary value that functions as a source […]

• November 29, 2022

California – you may have the sales tax obligations if your business have a nexus in California.

Retailers are generally required to collect sales tax on tangible personal property sold to consumers within California. Charges for services are not subject to sales tax unless they are included in the sale of tangible personal property. Similarly, in the case of computer programs and other digital products sold electronically, sales tax is not applicable […]

• November 24, 2022

California – Hiring an employee and employer’s obligations

Before hiring an employee in CA, the employer needs to register with the state for 1. Employer Withholding Tax Licensure, and 2. Unemployment Tax Licensure. The employee must sign and submit to the employer the federal Form W-4 and the state DE 4. The W-4 is used for federal income tax withholding calculation, and the […]

• March 29, 2022

Wyoming – If you want to incorporate in Wyoming, you may need to follow the procedures

Are you looking to incorporate in Wyoming? It is one the best states in the United Sates to incorporate, particularly for a Canadian or a Non-resident of the United States. Let’s look into this. Wyoming incorporation requirements in the United States Wyoming is the 10th largest state by area in the United States, located on […]

• January 25, 2022

New York – If a Canadian wants to incorporate in New York, follow these steps

As discussed in our other blogs there are several benefits of incorporation. When it comes to a Canadian incorporating in the US, we come across the questions that how to incorporate in US? Or Which state of incorporation is better? Or What is a New York Company? In this blog we will be specifically discussing […]

• January 10, 2022

Income Tax Rates – federal and state corporate income-tax rates that can help you in choosing the state of incorporation

How much tax do you pay in the US? What is the tax rate by the state? Before you incorporate in the United States, it is better to understand how corporate income taxation works in the United States. Different states in the United States charge different income tax rates in which some of the states […]

• December 1, 2021

401k plan – an Employer-sponsored retirement saving plans that helps you defer taxes and save for your retirement

Are you thinking about your retirement plans? Many of us before joining a new employer, do not pay attention to whether the employer has a well set up retirement plan for their employee? In your long-term tax planning as well as to secure your retirement future this could be a very important option to consider. […]

• November 28, 2021

IRA plan – Investing in IRA is a saving for your retirement with a tax deferral

Are you thinking about your retirement? Of course!  But it has a long way to go.  Dear friend, you need to act and plan it now. The important thought in this regard to consider is that, will you be able to generate the same amount of money when you reach 60ies or less? Maybe, or […]

Incorporate in USA – a Canadian or a foreign person can start their own company in the United States.

How do I incorporate a business in the US? This is a great question, We always hear from our clients, should I incorporate my business? If my answer is “yes”, then the next question is, how will I incorporate it? Well! it is a little complicated process and we are here to help you. Trust […]

Sales tax nexus – a remote seller, online retailers in the United States may have sales-tax obligation if they have a Sales tax nexus in the state

Are you in an e-commerce business, an online seller, and selling your products through Shopify, Amazon, or eBay in the United States? You need to know “what is sales tax nexus” in the United States. The consequences of being not aware of this topic could make you liable for a huge amount of sales tax […]

Incorporate – these are the types of Business structures or Legal entities that you can chose

What are the types of Business Entities & corporations in the USA? Your business is growing in the USA? Is it a good idea to incorporate a small business? The answer is not simple in the case of cross-border taxation. Before discussing this further let’s discuss, all the options you have in the United States, […]

Sales tax rates – by the state in the United States, you may need to know before issuing an invoice to your customer

You have an e-commerce business and you are selling in the United States. Do you need to charge sales tax? Whether you need to charge or not, depends on your nexus with the United States. Please visit our blog “nexus” on this topic to learn more about it. In this article, we are going to […]

• November 27, 2021

Donations/Charity – what are the tax benefits?

When you donate you save tax. However, it is difficult to say if it is good tax planning or not as it depends on person to person. In materialistic terms yes you are getting tax benefits by helping others but in the non-materialistic term, you may think that you are getting much more than that. […]

• November 23, 2021

Payroll taxes – an employer’s obligations when hiring an employee in the United States and processing US payroll

Do you want to employ someone in the USA? Grow your business with additional support for your business by hiring an employee or contractor. An employee who can work for you and promote your business. You need to understand the employer obligations in regards to payroll in the United States to be compliant and mitigate […]

• November 17, 2021

LLC taxation – the ways a Limited Liability Company is taxed in the United States

Wondering what is an LLC? LLC is a Limited Liability company. One of the most favorite legal entity structures that can be taxed as a Corporation or a partnership or as a sole proprietorship. This legal entity structure is not available in Canada. However, this could be the most tax-effective business structure for Canadians looking […]

• November 9, 2021

Capital gain tax – you do not have to pay tax on your Capital Gains, tax deferral section 1031 election

What is the capital gains exemption? Can you be exempt from capital gains tax when a Canadian sells property in the United States? Can you avoid capital gains tax by buying another house? Most of the answers could be “yes”. In our following discussion, we are trying to outline those situations and the conditions that […]

• November 1, 2021

Investment – a Canadian or a foreign person buying property in the U.S. – what are the potions?

What is withholding tax in real estate? Do Canadian pay capital gains tax on U.S. real estate? A Canadian selling U.S. property, need to know the U.S./Canadian tax implications. Knowing all the facts will help you keep more of the profits into your project and minimize tax.   Canadian buying US properties need to understand […]

• February 23, 2021

You can Claim a dependent deduction on your U.S. tax return

Can you claim a dependent on your individual income tax return? Well, it depends on your filing status and your relationship with the dependent. In this article, we are going to explore these relationships.   U.S. Citizen or Resident Alien – You can claim on your tax return a “dependent” who can be a qualifying […]

• February 18, 2021

Business expenses – 44 tax-deductible expenses that may apply to your business and keep a track to reduce your tax liability

What deductions can I claim for small businesses? How do small businesses maximize tax deductions? When you are in a business, these are the common thoughts you come across to achieve your tax-saving goal. You take all risks for your business and work hard to grow it, you deserve to keep maximum profit in your […]

• February 11, 2021

Ordinary and necessary business expenses – Small business deductions that helps reduce your business income and pay lower taxes

What can you legally write off as a business expense? You may think that the money you spent is for your business. However, IRS may consider it differently. In this topic, we are trying to discuss and give an idea that what are the tax w-offs legally allowed and most importantly how it should be […]

What you can claim under the Itemized deduction or should you claim a Standard deduction on your tax return

What itemized deductions are allowed? Which deductions are included in standard deductions? Is it better to take the standard deduction or itemize? These are the important questions you may have before filing your personal income tax return. The answers depended on your tax filing status, what you have on your plate to itemize, and then […]

• January 30, 2021

Foreign earned income exclusion

What is a foreign earned income exclusion? Who can avail of this tax benefit on his/her income tax return? You can claim this tax benefit or in other words avoid double taxation if you require to file a U.S. tax return simply because you are a U.S. citizen or you were a U.S. resident for […]

• January 26, 2021

What should be included in a FBAR?

What is FBAR reporting? Who needs to repot? In this article, we are discussing the details of FBAR reporting, who and when you must report.   FBAR reporting United States persons which include U.S. citizens, resident aliens, trusts, estates, and domestic entities that have an interest in foreign financial accounts or signature authority in any […]

• January 23, 2021

Streamlined filing compliance procedures – is the option to minimize your penalties and interests when you have unfiled taxes

What are Streamlined filing compliance procedures? Who can file Streamlined filing compliance procedures? In this post, we are going to discuss the detail of Streamlined filing compliance procedures, who, why, and what need to file. Also what other alternatives do you have. An individual who has failed to file several years of tax returns in […]

• January 17, 2021

Who is a Non-resident alien?

Who is a non-resident alien for tax purposes? Why do you need to know? Well, the taxation of a non-resident alien is different than those who are U.S. citizens or residents in the United States. In this article, we will be discussing your tax residency status in the United States.   Please visit “Taxation of […]

• December 14, 2020

Owning your Real Property in an LLC can be a better option for Canadian buying a property in USA

Do you want to buy a vacation property in the United States? Or do you want to invest in the real estate market in the USA? As of 2021 Canadian market is very hot in real estate, you have much better affordability in the USA. However, before making any such decision, you should look into […]

Passive activities loss limitation may not allow you to deduct your loss from your other income

Do you know a loss from passive activities will have limitations for tax purposes? You may not be allowed by IRS to set it off against your other income on your tax return. Let’s discuss in detail to get an understanding of passive activities rules for tax purposes.  Loss from your passive activities is treated […]

Non-resident alien, what is your filing status?

You are not a Canadian resident, but some income from the sources in the United States and still wondering if you need to file an income tax return in the United States? Let’s try and understand your tax obligations in the United States.   Non-resident alien filing US tax return 1040NR One thing is clear […]

As a Non-resident alien tax filer, you can avail some tax deductions and exemptions

When it comes to the personal taxation of a non-resident alien in the United States, you may need to get an understanding of tax terms that can help you minimize your income taxes payable. In this blog, we will try to explain those terms which relate to the taxation of a non-resident alien in the […]