₦airaland Forum

Favolly:
Yea, I guessed as much.

But i still don't see how she would have been liable to even withholding tax in the US since the transactions in question took place through her 'agent' in Nigeria. From the way I understand the arrangement, there wasn't really any concrete structure for all that


Or maybe it's my knowledge of these tax matters that are already rusty sha...

She is liable for estimated taxes, which is a form of withholding only that, IRS trust you as the business owner to remit the correct estimated amount, if there is a variance between amount remitted via estimation and IRS computed amount on tax day and that amount is great that IRS set threshold, you will be assessed a penalty by IRS.

US citizens and Residents are required to pay taxes on all foreign incomes. It also appear that, Pearles was more than, she was an employee of her in Nigeria, she controls everything and what need to be done and how the money have to be use, that is not how agent vs supplier relationship functions.

I have to say though, if she had been savvy there are legal ways to defer foreign income or profits for 10s of years and still not pay a dime in taxes in the US.

linearity:
She is liable for estimated taxes, which is a form of withholding only that, IRS trust you as the business owner to remit the correct estimated amount, if there is a variance between amount remitted via estimation and IRS computed amount on tax day and that amount is great that IRS set threshold, you will be assessed a penalty by IRS.

US citizens and Residents are required to pay taxes on all foreign incomes. It also appear that, Pearles was more than, she was an employee of her in Nigeria, she controls everything and what need to be done and how the money have to be use, that is not how agent vs supplier relationship functions.

I have to say though, if she had been savvy there are legal ways to defer foreign income or profits for 10s of years and still not pay a dime in taxes in the US.

Hmmn...

I get the picture now, thanks for schooling me

Chanchit:
That's why its not good to chop alone, now she has @least her mother and bf to escort her to jail.

Lol

obontami:
ologogoro omo

Oko ashawo

linearity:
She is liable for estimated taxes, which is a form of withholding only that, IRS trust you as the business owner to remit the correct estimated amount, if there is a variance between amount remitted via estimation and IRS computed amount on tax day and that amount is great that IRS set threshold, you will be assessed a penalty by IRS.

US citizens and Residents are required to pay taxes on all foreign incomes. It also appear that, Pearles was more than, she was an employee of her in Nigeria, she controls everything and what need to be done and how the money have to be use, that is not how agent vs supplier relationship functions.

I have to say though, if she had been savvy there are legal ways to defer foreign income or profits for 10s of years and still not pay a dime in taxes in the US.

Not necessarily. Business owners can get a credit off taxes paid in foreign countries against the taxes paid in their home country. Home countries don't double tax because they understand that business owners also pay tax to the foreign governments. You do declare the income and write off expenses including tax paid to foreign governments. Even if she had to pay tax it will not be substantial as you can write off a lot of business expenses.

The fact is this little fool has destroyed herself because of greed. Whether Dencia pays tax or not is not her business. Her business as an employee is to sell the product and remit funds to her employer. Which is stole and that is a very big crime. She is a rogue and a clear eyes criminal who people should run from.

baby124:
Not necessarily. Business owners can get a credit off taxes paid in foreign countries against the taxes paid in their home country. Home countries don't double tax because they understand that business owners also pay tax to the foreign governments. You do declare the income and write off expenses including tax paid to foreign governments. Even if she had to pay tax it will not be substantial as you can write off a lot of business expenses.

The fact is this little fool has destroyed herself because of greed. Whether Dencia pays tax or not is not her business. Her business as an employee is to sell the product and remit funds to her employer. Which is stole and that is a very big crime. She is a rogue and a clear eyes criminal who people should run from.

They are two different revenue streams, taxes paid abroad can only offset taxes assessed on the foreign earned income....e.g. if Nigeria taxed the income you earned in Nigeria, the US is not going to give you credit towards that tax on your US earned income....The IRS will calculate your tax liability for that foreign income and if the amount is greater or equal to the amount already paid in taxes in Nigeria, then your US tax liability for the foreign earned income will be zero, otherwise you will be assessed taxes on that foreign income just like on your US income. And it can not be negative i.e. it can not have an effect of reducing your already assessed tax on incomes earned within the US.

If the business is incorporated, the taxing policy are different depending if it is an LLC, S-corp or C-corp...and yes there is still double taxation in the US especially C-corps.

linearity:
They are two different revenue streams, taxes paid abroad can only offset taxes assessed on the foreign earned income....e.g. if Nigeria taxed the income you earned in Nigeria, the US is not going to give you credit towards that tax on your US earned income....The IRS will calculate your tax liability for that foreign income and if the amount is greater or equal to the amount already paid in taxes in Nigeria, then your US tax liability for the foreign earned income will be zero, otherwise you will be assessed taxes on that foreign income just like on your US income. And it can not be negative i.e. it can not have an effect of reducing your already assessed tax on incomes earned within the US.

If the business is incorporated, the taxing policy are different depending if it is an LLC, S-corp or C-corp...and yes there is still double taxation in the US especially C-corps.

Nope. Double taxation in the C-Corp is a different thing from foreign vs local tax. Double taxation is the nature of a C-Corp. tax on dividend and tax on income. Now, that is totally different from a sole proprietorship that mostly reports a loss. Hardly would you see a company report a profit except they are public. Why? The cost of doing business. So insinuating that Dencia is avoiding tax is a fallacy. Do you know if she filed tax in Nigeria and is incorporated? Even if she has income in Nigeria and discloses it, the income is taxable up to the loss she probably experienced in Nigeria. Tax issues are not so simple and straight forward. A lot goes into determining whether an entity owes tax in a given year. So you cannot insinuate that she is avoiding tax, or she would even owe tax.

baby124:
Nope. Double taxation in the C-Corp is a different thing from foreign vs local tax. Double taxation is the nature of a C-Corp. tax on dividend and tax on income. Now, that is totally different from a sole proprietorship that mostly reports a loss. Hardly would you see a company report a profit except they are public. Why? The cost of doing business. So insinuating that Dencia is avoiding tax is a fallacy. Do you know if she filed tax in Nigeria and is incorporated? Even if she has income in Nigeria and discloses it, the income is taxable up to the loss she probably experienced in Nigeria. Tax issues are not so simple and straight forward. A lot goes into determining whether an entity owes tax in a given year. So you cannot insinuate that she is avoiding tax, or she would even owe tax.

I understand LLC/s-Corp/c-corp taxation... You hit the nail in the head when you state that, businesses can use expenses to reduce or limite their tax reliability, but you diverted when you summise that she might be incorporated in Nigeria or might be paying taxes, or that she might not be avoiding taxes, etc.

Her setup is exactly how shell foreign companies hide their foreign income from taxation. It is now illegal not to report foreign bank accounts in IRS tax filings and with BVN, it is very easy for IRS to find people who hide their accounts with significant amounts, they did that in highly secretive Swiss banks and can do it in Nigeria.

What did she do? She ask Pearl to pay all payments coming from Nigeria in Pearl's personal account. That is not the typical behavior of a Nigeria incorporated company, even if she does not want to get a corporate bank account, why not open a personal one and have all payments go into it? Does it have anything to do with IRS requirement to report all foreign accounts?

Also, from her comments, N40m plus another $15k were missing and she did not know until she read the girl's txt messages, that is more than $150k, which means, she must have been commanding much more than that amount in trades...I think IRS will be interested in that level of international transaction....As you said, she can make up expenses to cover all that amount, while all her money is in someone else personal account that she cannot report to IRS...and you do not see any deception or attempt to avoid taxation in that?