American manufacturers and businesses need to compete in the global economy to be successful. Let CSG Strategic Tax Consultants strengthen your company, both abroad and at home, by tapping into federal export incentives to save you and your shareholders money.
How? If you’re a manufacturer, producer, reseller or exporter of goods made in the U.S.A., and those goods are destined for overseas sales, you may be eligible to establish an IC-DISC – Interest Charge-Domestic International Sales Corporation.
IC-DISC provides an excellent way to significantly cut down on the export taxes your company must pay under IRS tax laws. IC-DISC was added to the IRS Code in 1984 and retooled in 2004 under the Jobs and Growth Tax Relief Reconciliation Act.
If you’re an exporter, CSG can provide you with turnkey services to navigate through IRS rules and regulations governing the formation of a tax-exempt IC-DISC.
CSG will help you make the right decision when it comes to choosing two separate paths to savings under IC-DISC provisions.
The first: Your export company pays a 50 percent commission to your IC-DISC, which, in turn, is tax exempt from that commission income. Your export company expenses the commission to the IC-DISC; thus, reducing your ordinary income.
The IC-DISC then pays dividends to its owners, which are taxed at considerably cheaper rates when the dividends are distributed.
The second: Your export company pays 4 percent of your qualified export receipts, which can include gross receipts from the sale, exchange or other disposition of export property; gross receipts from the lease of rental or export property used outside the U.S.; among others.