What exactly is 'effectively connected income' under IRC 864(c)? How do I know if my LLC income qualifies?
I'm a Brazilian business owner with a Florida LLC that sells digital products online. Some sales go to U.S. customers, some to international customers. My CPA says I need to figure out what income is 'effectively connected' under IRC 864(c) to determine my U.S. tax liability. But I don't understand how to tell which income is ECI and which isn't. Is all my LLC revenue effectively connected? Or only the U.S. customer sales? And what's the difference between ECI and 'U.S. source' income?
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