International business people have additional considerations. Non-U.S. citizens who reside here must do the same.
Income can be subject to taxes in more than one country.
Tax treaties exist between many countries and can significantly modify the tax treatment of income in each. Taxes paid to a foreign country may be creditable against U.S. income taxes. Mutual funds with investments in foreign stocks also generate foreign tax credits. Corporate Taxes Foreign employees in the United States may or may not be subject to social security, medicare, federal unemployment, and state unemployment taxes, depending on their situation. Related companies must transfer inventory at reasonable rates and may not use price allocation to avoid U.S. income tax.