Passive Foreign Investment Companies Overview | Bennett Thrasher Skip to main content

Advisors and their clients need to be aware of the PFIC rules as they apply to their clients that are investing abroad.  If your client is considering investing in a foreign corporation that might otherwise seem like a rather benign investment, that client likely has disclosure requirements back in the U.S. and if classified as a passive foreign investment company (PFIC) may incur unexpected tax due to the complicated U.S reporting regime for PFICs.

This article will help the reader understand the technical definition of a PFIC followed by certain elections a taxpayer can make to minimize the negative U.S. tax consequences of owning shares in a PFIC.

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For more information on Passive Foreign Investment Companies, please contact Chris Benner by calling 770.396.2200.