If you're a U.S. person receiving income from abroad, or a foreign person earning income connected to the U.S., withholding rules can catch you off guard. Getting the basics right now can prevent notices, penalties, and cash-flow surprises later.

Internal structure in CFCs If you're a U.S. person who owns (or has a stake in) a company incorporated outside the United States, three terms should be on your radar: Controlled Foreign Corporation (CFC), Subpart F income, and GILTI. These rules exist to prevent U.S. shareholders from parking profits offshore indefinitely — and they can generate a current U.S. tax bill even if you never see a dividend from the foreign company. This week, we're breaking down how these three pi

If you're holding Bitcoin, Ethereum, or other digital assets on an exchange based outside the U.S. — Binance, a Hong Kong or Singapore-based platform, or an exchange tied to your home country — you may be sitting on a reporting obligation you haven't thought about. Crypto feels borderless, but the IRS and FinCEN don't see it that way. Where your exchange is legally domiciled matters, and getting it wrong can mean penalties that have nothing to do with whether you owed any tax

Putting your spouse, child, or parent on the payroll is one of the most common — and most misunderstood — small business tax moves. Done correctly, family employment can shift income to lower tax brackets, unlock retirement plan contributions for a minor, and even eliminate certain payroll taxes entirely. Done carelessly, it's one of the fastest ways to draw an IRS examination, because the family relationship itself is a built-in audit flag.

A rental is a rental, right? Not when it's overseas. Foreign rental real estate is stuck on a slower depreciation schedule with no bonus depreciation, and recapture at sale brings in currency translation and FTC sourcing that most software won't catch. Here's the full domestic-vs-foreign comparison.

Estimated taxes aren't just an IRS formality — they're one of the simplest tools you have to stay ahead of your tax bill instead of chasing it. Here's why we bring this up every quarter, plus a quick quiz to see where you stand.

New York City skyline representing shadow payroll and cross-border tax compliance for global employees If you have a client who's working across borders — a US employee on assignment in London, a UK national temporarily in a New York office, or an executive splitting time between two countries — chances are “shadow payroll” has come up in conversation. It sounds like something out of a spy movie, but it's actually one of the most common (and most misunderstood) tools in globa

The green card test — not the card itself — determines U.S. tax residency. This week's Tax Talk Thursday walks through dual-status filing, the LTR 8-of-15-year test, Form 8854 mechanics, and the compliance risks of an expired-but-unterminated green card.

Passive activity loss rules quietly limit how much rental and passive losses you can deduct each year. This week's Tax Tip Tuesday breaks down the income phase-outs, Real Estate Professional Status traps, and documentation gaps that turn a legitimate loss into an audit flag.

The PTE election sounds technical, but the idea is simple: let your business pay a piece of your California tax so you can deduct it federally without a cap. Here's a plain-English breakdown of how it works and who it's for.

Organizational chart showing multiple connected business entities — MKHS Tax Group blog on multi-entity structures and IRS scrutiny If your business has grown to include more than one entity — an operating company, a holding company, maybe a separate property LLC — you're not doing anything wrong. Multi-entity structures are common, often advisable, and frequently the smartest way to separate liability, isolate assets, and plan for growth. But it's worth understanding how the

Most business owners have never heard of the Augusta Rule — a tax provision that lets you rent your own home to your business for up to 14 days a year, with the rental income excluded from your personal taxes entirely. This week's Tax Tip Tuesday breaks down how it works, who qualifies, and why the size of your home changes the math.

Basis is one of the most important numbers in your tax life — and one of the most consistently ignored.

The home office deduction is one of the most misunderstood — and most scrutinized — deductions on a tax return. I see it come up constantly in client conversations, and the same question surfaces every time: "Is it really worth claiming? Will it trigger an audit?" The honest answer? Done right, the home office deduction is completely legitimate and worth claiming. Done wrong, it's a red flag that can invite exactly the kind of IRS attention you want to avoid.

Schedule E is one of the most scrutinized sections of your tax return. From rental losses to K-1 mismatches to passive activity rules, the IRS is watching — and documentation is everything.

If you own an S corporation and take distributions, there's one number the IRS watches more closely than almost any other: your salary. Specifically, whether it's reasonable. Getting this wrong isn't just a technicality — it's one of the most common (and costly) audit triggers for small business owners. What Is Reasonable Compensation? The IRS requires that S-corporation shareholder-employees who perform services for the company pay themselves a reasonable salary before takin

LLC or S Corp? The right answer depends on your profit level, your appetite for paperwork, and your California tax picture. Take this 5-question quiz to cut through the noise.

Tuesday's blog introduced the three covered expatriate tests and the early warning indicators that signal exit tax exposure under IRC Section 877A. If you haven't read that post yet, start there. This Tax Talk Thursday goes deeper — and it focuses specifically on two groups whose situations are more nuanced, more misunderstood, and frankly more dangerous than the general headlines suggest: long-term green card holders and dual citizens. Both groups carry unique risks that sta

Did you know that moving to a new state doesn't automatically end your tax obligations to your old one? Learn the six warning signs that your former state may still consider you a resident — and the steps you need to take to protect yourself from a costly audit.

Now that you have established or become a beneficiary of a foreign trust, you may need to consider whether you have a US income tax return and information reporting requirement. If you are a US citizen, permanent resident, or a US resident taxpayer you may be subject to US taxes and reporting on your worldwide assets.