Hi all, does anyone know if the USA has / enforces hybrid mismatch rules where if you don't pay tax as a NRA with an LLC in a foreign country, they'll charge you tax? I am wondering if I pay 0% tax with my LLC as a non resident alien of the USA, if they have mismatch rules which demand the LLC no longer be treated as transparent if I am benefiting from 0 tax in my country of residence.
Furthermore, if they do, would this apply to only an LLC paying 0 tax in USA, or could it alslo apply to me working as an employee for my company, where both the USA and foreign state do not charge me income tax?
My country of residence is Cyprus by the way, and I am trying to decide as a non dom how to best structure paying myself. Also considering other countries like Panama and Paraguay. As non dom in CY, I can be subject to 0 tax on foreign employment 90+ days of the year, and I could perhaps structure my LLC to not pay taxes with shell copmanies, but I am wondering if all of this is even worth the effort if the USA has / enfoces anti hybrid mismatch rules, which could essentially just make me liable to tax in the USA anyways, and it would be not worth the time.
And if hybrid mismatch rules do apply, is it for anywhere that charges less tax than the USA, or is there a threshold, of perhaps say, 50% or more tax savings for hybrid mistmatch rules to apply?
Last edited: Mar 23, 2024
Furthermore, if they do, would this apply to only an LLC paying 0 tax in USA, or could it alslo apply to me working as an employee for my company, where both the USA and foreign state do not charge me income tax?
My country of residence is Cyprus by the way, and I am trying to decide as a non dom how to best structure paying myself. Also considering other countries like Panama and Paraguay. As non dom in CY, I can be subject to 0 tax on foreign employment 90+ days of the year, and I could perhaps structure my LLC to not pay taxes with shell copmanies, but I am wondering if all of this is even worth the effort if the USA has / enfoces anti hybrid mismatch rules, which could essentially just make me liable to tax in the USA anyways, and it would be not worth the time.
And if hybrid mismatch rules do apply, is it for anywhere that charges less tax than the USA, or is there a threshold, of perhaps say, 50% or more tax savings for hybrid mistmatch rules to apply?
Last edited: Mar 23, 2024