Accommodating Non-U.S. Investors: Structuring Real Estate and Other Fund Investments to Minimize U.S. Tax Impacts

Non-U.S. investors present a significant source of capital for hedge funds and private equity funds. These investors are primarily concerned with avoiding U.S. tax filing obligations and paying U.S. tax on “effectively connected income” which can result from a non-U.S. investor’s investment in U.S. real estate, certain U.S. loans and U.S. operating companies. In this course, Tannenbaum Helpern tax attorneys Michele Itri and David Schulder along with RSM US LLP's International Tax Principal Mark Strimber discuss certain blocker structures and other techniques that can be used to accommodate these concerns and minimize the U.S. tax drain on investment returns of non-U.S. investors.

Learning Objectives:

1. Understand framework for U.S. taxation of foreign investment in the U.S.
2. Gain insight into the U.S. tax issues raised by foreign investment in U.S. loan originations, U.S. operating companies and U.S. real estate
3. Explore various structures that can be used to reduce the effective U.S. tax rate applicable to foreign investments
4. Identify how debt can be used to capitalize U.S. blocker corporations to reduce US corporate level tax and impact of recent proposed regulations