Q: Am I in violation of the law by wiring the profits to my partners?
I am a part owner of a business. My 2 partners are not citizens and do not reside in the US. Every year, my accountant divides the profits. I pay taxes on my portion but not the money I wire to my partners. I have asked about the legality of this with my accountant but I have never received an answer.
A: Generally, your foreign partners may be subject to the US taxation on their US income, and subject to withholding. The information presented herein is for general purposes only. It is not intended to, and may not be construed as legal, tax or accounting advice. For specific advice, please consult a tax attorney in person. Good luck. Zaher Fallahi, Tax Attorney, CPA (California).
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