Professor Lathrope Fall 2016 djlathrope@usfca.edu FOREIGN TAX I Online Syllabus COURSE DESCRIPTION: Foreign Tax I is the introductory class in United States international taxation. Coverage includes the jurisdiction of the United States to tax international transactions, the rules for determining the source of income and deductions, U.S. taxation of nonresident aliens and foreign corporations, and the foreign tax credit. REQUIRED COURSE MATERIALS: Paragraph references to Text in the syllabus are to Gustafson, Peroni & Pugh, Taxation of International Transactions Materials, Text and Problems (4th ed., 2011). Selected Sections-United States International Taxation (2016 Ed., Foundation Press). Sections of the Internal Revenue Code and regulations should be reviewed as they are discussed in the Text. LEARNING OUTCOMES The learning outcomes for the course include: (1) Knowledge and understanding of doctrine, (2) Development of skills in statutory construction, (3) Ability to engage in legal analysis and reasoning, and (4) Efficacy in problem-solving. EXAMINATION AND GRADING: Your grade will be based on anonymously graded mid-term and final examinations. The mid-term will count one-third of the grade and the final will count two-thirds of the grade. Check on the law school website for the dates of the exams. For the exams, you will be allowed to use the course materials and anything prepared by you (including class notes). A simple calculator may be used. Grading will be on the law school s scale of A, B, C, D and F with pluses and minuses. OFFICE HOURS: Office hours will be held online in scheduled Zoom sessions. The time for those sessions will be announced. 1
HOURS OF WORK PER CLASS The American Bar Association standards for accrediting law schools contain a formula for calculating the amount of work that constitutes one credit hour. According to ABA Standard 310(b)(1), a credit hour is an amount of work that reasonably approximates: (1) not less than one hour of classroom or direct faculty instruction and two hours of out-of-class student work per week for fifteen weeks, or the equivalent amount of work over a different amount of time. This is a 2-credit hour class. All told, applying the ABA standard to the number of credits offered for this class, in a full semester class you should plan on spending, on average, a total of 6 hours per week on course-related work. In a seven week course, the average time spent per week would be 12 hours. Module 1. Module 2. Welcome to the Course Introduction and Overview Text: Skim && 1070 1135 for background; Study Text: && 1140 1165 Module 3. Jurisdiction to Tax: Introduction Study Text: && 1170 1185. See Reg. 301.7701(b)-1 & -2. Problems: 1190 (Problem 2) Module 4. Jurisdiction to Tax: Problems Problems: && 1190 (Problems 3, 4 & 5). See Reg. 301.7701(b)-3(c) & (d). Module 5 Jurisdiction to Tax: Expatriation Text: 1195 Problems: 1200 Module 6 Jurisdiction to Tax: Classification Issues and Overview Text: 1205-1225 Problems: 1230 Module 7 The Role of Income Tax Treaties in International Taxation 2
Text: && 1235-1295 Problem: & 1285 Module 8 Source: Introduction, Interest, Dividends, and Rents and Royalties Text: & 2000-2021 Problems 2215 (Problems 1, 2, 4 & 5) Module 9 Source: Compensation for Personal Services Text: && 2025-2100 Problems: & 2215 (Problem 3) Module 10 Source: Sales of Property (Part 1) Text: & 2105, && 2110-2175 Problems: & 2215 (Problems 6 & 12) Module 11 Source: Sales of Property (Part 2) Text: && 2110-2175 Problems: & 2215 (Problems 9, 7, 8, 10, 13 & 14 - the problems will be discussed in this order) Module 12 Module 13 Module 14 Module 15 Module 16 Module 17 Source: Special Rules Text: && 2180-2211 Problems: & 2215 (Problem 11) Source: Introduction to Rules for Deductions Text: && 2220 2225 Source: Interest Expense and R & D Text: 2230-2240 Problems: & 2235 Taxation of Foreign Persons: Introduction Text: & 3000 U.S. Trade or Business Text: && 3005 3095 Determining Amount to be Taxed Text: && 3100, 3110-3120, 3135-3140, 3150 3
Module 18 Module 19 Module 20 Module 21 Problems on Trade or Business Income Problems: & 3155 Introduction to Effects of Treaty Provisions Text: && 3160-3185, 3190 3220 Problems on Effects of Treaty Provisions Problems: & 3225 (Problems 1, 2, 3 & 4) Branch Profits Tax Text: & 3230 Problems: & 3235 Module 22 Module 23 Module 24 Module 25 Module 26 Module 27 Module 28 Module 29 Module 30 FDAP: Introduction Text: && 4000 4025 Untaxed Items of U.S. Source FDAP Income Text: && 4027-4047 Effects of Treaties on Withholding Taxes Text: && 4050 4102 Gains From Sale of Property Not Effectively Connected With U.S. Trade or Business Text: && 4110-4115 Withholding Mechanism Text: && 4120-4125, 4155-4182 Problems Problems: 4280 Problems 1-8, 11 Treatment of Gains from U.S. Real Property Text: && 4185 4260 Problems: 4280 Problems 12-16 Financing the U.S. Enterprise Text: && 4265 4270 The Foreign Tax Credit: Introduction Text: & 5005, 5010 (pp. 308-top of 310), 5133 4
Module 31 Creditable Payments (Sections 901 and 903) Text: && 5015-5025, 5050, 5060-5110, 5125 Module 32 Problems on Creditable Payments Problems: & 5130 (Problems 1 4, 14, 15) Module 33 Indirect Credit (Section 902) Text: && 5135 5150 Module 34 Module 35 Problems on the Indirect Credit Problems: & 5140, 5180 (Problem 1) Tax-Sparing Credits Text: & 5210 Module 36 Module 37 Module 38 Module 39 Introduction to Foreign Tax Credit Limitations Text: && 5215 5275 (skim 5245-5253) Problems: 5620 Problems on Foreign Tax Credit Limitations Problems: & 5280 (problems 1-4) Tax Exemption for Certain U.S. Taxpayers Living Abroad (Section 911) Text: & 5325-5335, 5350-5355, 5365-5370 Problems: & 5375 (Problem 1 - assume Clemens' bonus is $15,000) The Role of Tax Treaties in Mitigating the Double Taxation of U.S. Persons Text: && 5380-5390 5