US Double Tax Treaties Under these treaties, residents of foreign countries are taxed at a reduced rate or are exempt from income taxes on certain items of income they receive from sources within the United States, and vice versa.

Table Of Tax Treaties A listing of the 54 countries with which the US has double tax treaties.

Recent Developments In US Tax Treaties New treaties; Changes and clarifications to existing treaties.

Dividend Taxation Under 2003 Tax-Cutting Legislation Four US income tax treaties do not meet the requirements of the Act.

Tax Information Exchange Agreements Many offshore jurisdictions don't want to or are not eligible to enter fully-fledged double tax treaties with their major trading partners.

Transfer Pricing Most double tax benefits are linked to acceptable transfer pricing; few international transactions can now ignore it.

Dividend Taxation Under 2003 Tax-Cutting Legislation

The Jobs and Growth Tax Relief Reconciliation Act of 2003 generally provided that a dividend paid to an individual shareholder from either a domestic corporation or a “qualified foreign corporation” is subject to tax at the reduced rates applicable to certain capital gains. A qualified foreign corporation includes certain foreign corporations that fall under the terms of those double tax treaties which include an exchange of information program. The foreign corporation must be a resident within the meaning of such term under the relevant treaty.

A 'qualified foreign corporation' does not include any foreign corporation which for the taxable year of the corporation in which the dividend was paid, or the preceding taxable year, is a foreign personal holding company, a foreign investment company, or a passive foreign investment company.

Four US income tax treaties do not meet the requirements of the Act. The tax treaties with Bermuda and The Netherlands Antilles are not comprehensive income tax treaties within the meaning of the Act; the USSR income tax treaty, which continues to apply to certain former Soviet Republics, does not include an information exchange program. The current income tax treaty with Barbados was determined not to be satisfactory because of concern that the treaty may operate to provide benefits which are intended to mitigate or eliminate double taxation in cases where there is no risk of double taxation.

With the exception of these four countries, all of the treaties listed in the table above qualify under the Act.

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Table Of Tax Treaties
A listing of the 54 countries with which the US has double tax treaties.

Recent Developments In US Tax Treaties
New treaties; Changes and clarifications to existing treaties.

Dividend Taxation Under 2003 Tax-Cutting Legislation
Four US income tax treaties do not meet the requirements of the Act.

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