961. CHAPTER 9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #43 Shannon, a foreign person with a green card, spends the following days in the United States. 2010 360 days 2011 150 days 2012 30 days Shannon’s residency status for 2012 is: a. U.S. resident because she has a green card. b. U.S. resident since she was a U.S.

961. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #43
Shannon, a foreign person with a green card, spends the following days in the
United States.

2010

360 days

2011

150 days

2012

30 days

Shannon’s residency status for 2012 is:

a.
U.S. resident because she has a green card.
b. U.S. resident since she was a U.S.
resident for the past immediately preceding two years.
c. Not a U.S. resident because Shannon was
not in the United states for at least 31 days during 2012.
d. Not a U.S. resident since, using the
three-year test, Shannon is not present in the United states for at least 183
days.

962. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #44
Lang, an NRA who was not a resident of a treaty country, receives taxable
dividends of $50,000 from U.S. corporations. Lang does not conduct a U.S. trade
or business. Lang’s dividends are taxed by the United States through
withholding by the payor of:

a.
0%.
b. 15%.
c. 30%.
d. 35%.

963. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #45
Which of the following statements regarding foreign persons not engaged in a
U.S. trade or business is true?

a.
Foreign persons are not subject to U.S. tax if not engaged in a U.S. trade or
business.
b. Foreign persons with any U.S.-source
income are taxed on net investment income (after expenses).
c. Foreign persons are subject to
potential withholding taxes on the gross amount of U.S.-source investment
income.
d. Foreign persons with only U.S.-source
investment income are exempt from U.S. tax.
e. None of the above statements are
true.

964. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #46
The following income of a foreign corporation is not subject to the regular
U.S. corporate income tax rates.

a.
Capital gains effectively connected with a U.S. trade or business.
b. FIRPTA gains.
c. Fixed, determinable, annual or
periodic income effectively connected with a U.S. trade or business.
d. Income from sale of inventory where
title passes in the United States, but no U.S. trade or business exists.

965. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #47
Fulton, Ltd., a foreign corporation, operates a U.S. branch that reports effectively
connected U.S. earnings and profits (after income taxes) of $600,000 for the
tax year. The branch’s U.S. net equity at the beginning of the tax year is $2
million and at the end of the tax year is $1.5 million. Fulton is organized in
a nontreaty country. Fulton’s dividend equivalent amount for the year is:

a.
$100,000.
b. $500,000.
c. $600,000.
d. $1,100,000.

966. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #48
Jilt, a non-U.S. corporation, not resident in a treaty country, operates a U.S.
branch that earns effectively connected E & P of $4 million for the tax
year. The branch increases its investments in U.S. property (its U.S. net
equity) by $1,600,000. The branch pays a U.S. corporate income tax of
$2,153,846. Jilt’s branch profits tax is:

a.
$720,000.
b. $1,200,000.
c. $2,153,846.
d. $2,873,846.

967. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #49
Which of the following statements regarding the taxation of U.S. real property
gains recognized by foreign persons not engaged in a U.S. trade or business is false? Gains from the disposition of
U.S. real property are:

a.
Taxed to foreign persons notwithstanding the general exemption of capital gains
from U.S. taxation.
b. Taxed to foreign persons without regard
to whether such foreign persons are engaged in a U.S. trade or business.
c. Taxed in the U.S. because such gains
are treated as if they are effectively connected to a U.S. trade or business.
d. Not taxed to foreign persons because
real property gains are specifically exempt from U.S. taxation.

968. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #50
Which of the following transactions, if entered into by an NRA, is not subject to U.S. taxation?

a.
Sale of a commercial building located in Houston, Texas, and owned directly by
the NRA.
b. Sale of stock of a foreign
corporation whose only asset is a U.S. building.
c. Sale of stock of a domestic
corporation whose only asset is undeveloped U.S. real estate.
d. Sale of partnership interest. The
partnership’s assets predominantly are made up of U.S. real estate.

969. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #51
ForCo, a foreign corporation not engaged in a U.S. trade or business,
recognizes a $3 million gain from the sale of land located in the United
States. The amount realized on the sale was $50 million. Absent any exceptions,
what is the required withholding amount on the part of the purchaser of this
land?

a.
$0.
b. $300,000.
c. $500,000.
d. $3 million.
e. $5 million.

970. CHAPTER
9—TAXATION OF INTERNATIONAL TRANSACTIONS Question MC #52
Which of the following situations requires the filing of an information return
with the U.S. government?

a.
A domestic corporation that is 25% or more foreign owned.
b. A foreign corporation carrying on a
trade or business in the United States.
c. U.S. persons who acquire or dispose
of an interest in a foreign partnership.
d. All of the above.
e. None of the above.