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Legal Beat structure to avoid CFC status. Sourcing Income of Foreign Persons. Second, Prop. Reg. § 1.863-8(b)(3) pro- vides that, if a foreign person is engaged in a U.S. trade or business, the foreign person's income derived from ocean activity is presumed to be U.S. source income. The regulations provide that if a foreign person can allocate gross m •m ocean income between (1) income from sources within the United States or international waters, and (2) without the United States and international water to the satisfaction of the IRS, then income from without the United States and from international waters will be treated as foreign source income. The new regula- tions also provide that when a foreign person is entitled to the benefits of a tax treaty with the United States, the person may elect to be taxed under the rules of that treaty so that the United States would tax only income attributable to a permanent establishment of that foreign person in the United States. Under these proposed regulations, a greater portion of a foreign person's MARITIME COMMUNICATION SERVICES HARmS Satellite Communications • Ships, Rigs, Platforms, Buoys • Broadband Services Via C and Ku Band • Customized Private Global Networks • Voice, Data, Internet, and Video Services • Complete Worldwide Coverage Harris Maritime Communication Services, Inc 1025 W. NASA Boulevard | Melbourne, FL USA 32919 www.mcs.harris.com | mcsweb@harris.com 1-321-674-4750 I Fax: 1-321-674-4751 Circle 327 on Reader Service Card mm asms DIESEL Till [FILTERS & TANKS Optimal Fuel Quality MORE POWER - LESS SMOKE Zero Maintenance Lifetime Warranty C.»XXiMfiAtlk 1-877-425-4239 Before Cleaning Tanks or Replacing your Fuel Dealer Inquiries: 1-877-425-4239 Fax: 941-463-7855 www.aigae-x.net e-mail: aigae-x
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