Subpart F Income

The earnings of foreign corporations generally are not taxed in the U.S. until the foreign corporation repatriates its earnings through the distribution of dividends.  This is known as the concept of “deferral” (i.e., U.S. taxation is deferred until repatriation).  Various exceptions to deferral exist today (often referred to as “anti-deferral” regimes).  Subpart F income is one of these exceptions to deferral. Subpart F income only applies to Controlled Foreign Corporations (CFC’s).

A CFC, very generally, is defined as a foreign corporation in which U.S. persons own more than 50 percent of the corporation’s stock (measured by vote or value).  Stock ownership includes direct ownership as well as stock owned indirectly or constructively.

When a CFC earns subpart F income, the United States generally taxes the corporation’s U.S. shareholders curre

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Malaysia : once-vaunted biofuel industry grinds to halt

Malaysia’s once-vaunted biofuel industry has seen production grind to a halt since a Mar 2010 announcement that the government’s mandatory switch to the green energy will be delayed to June 2011. Malaysia had ambitions to become a global leader in biodiesel and unveiled grand plans for the industry as the price of crude oil spiralled, peaking in mid-2008. However, the future of the alternative fuels is now in question given cheaper crude prices and the higher cost of Malaysia’s palm oil.

Malaysian Palm Oil Board (MPOB) figures show that the production of biodiesel, a mixture of diesel with 5% processed palm oil, dropped 99% from 12,640 tonnes in March to just 137 tonnes in July. Malaysia has approved 56 licences for biodiesel output, which would create a production capacity of 6.8 million tonnes, but most plants have not been set up.

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Cash Loans – High Interest Rates

It is a fact that sometimes, money is tight. Everyone will be in this situation at some stage in their life. They are in urgent need of funds to avoid bouncing checks or missing important payments. If you have a steady source of income, and you need money for only a short period of time, a cash loan, or paycheck advance may seem like an attractive option. But take care, as they are often a lot less attractive than they seem.

Cash loans are for relatively small amounts and are very fast and easy to arrange. They are for very short periods but the rates of interest charged can be very hefty indeed. The whole loan can be arranged in minutes and typically involves presenting your paycheck or other security such as a car title. If the loan is approved you can walk out with a check or a transfer can be made instantly to your account.

However, they are extremely expensive forms of credit.

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[Something for the weekend] Do you believe in Merkels?

At first sight, this looks mad. Lending to the UK government, in charge of the clapped-out British economy, now returns less than lending to Europe’s most successful country.  Worse still, the yields on gilts are measured in sterling, a chronically weak currency, so not only does your money earn less, you’ll be repaid in something which history says will have been devalued by the time you get it back. Oh, and by the way, inflation is 3 per cent above the yield, making the internal devaluation painful, too.

Something is seriously awry here, and two events this week offer clues to why German government 10-year paper yields more than the equivalent UK stock. On Wednesday the markets were spooked by the failure of an auction of 10-year German debt. Those in this arcane world struggled to understand what it meant, so there’s little hope for the rest of us. It’s ei

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Toys with hidden costs

I bought my son a Leapster Explorer last Christmas (actually, Santa delivered it) and while the upfront cost was expected, the ancillary costs of this toy started to add up fast.

We bought two games to go with it from the start, but soon enough our son’s interest in those waned, so we agreed to buy him two more. At $25 each, the hidden costs of owning a game system for my son’s little hands were increasing. That’s where we stopped, but there are many other toys with accessories that can get parents wishing that Santa had left the toy at the North Pole.

Not just batteries

Batteries are at the top of any list of hidden costs, although they shouldn’t be too hidden when you buy the toy. Still, they’re an ongoing cost, so we decided to go with the more expensive rechargeable batteries, which can cost about $30 with a charger.

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Morning Service Disruption

This morning at around 6 a.m. Mountain Time one of our data centers reported what initially appeared to be intermittent access problems related to heavy user traffic. Our tech teams immediately began working on the problem. We found the slowdown was related to problems with a primary firewall at that data center. At 8:50 a.m. Mountain Time we were able to resolve the problem and full service for all customers was restored. We’re sorry for the service interruption. Our tech teams will be carefully reviewing what happened so we can make sure it doesn’t happen again.


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