Can my foreign parent charge my US LLC a 'management fee' for oversight and governance — or is some of that not chargeable at all?
My overseas holding company wants to bill my US LLC a flat annual 'management fee' that covers, among other things, my own time overseeing the investment, parent-level governance, and some legal/regulatory work the parent has to do anyway. Separately the parent provides actual day-to-day operational help. Can all of this be charged to the LLC, or are there categories that simply aren't billable no matter how I document them?
Related Questions
Can my foreign company charge my US LLC for bookkeeping and IT support at cost with no markup?
I personally handle the LLC's bookkeeping, payroll coordination, and IT help-desk stuff through my company back home, and I want to invoice the LLC for it. An accountant said I have to add a profit ma...
What interest rate do I have to charge on a loan from me (the foreign owner) to my US LLC?
I wired money into my US LLC to fund operations and we're calling it an owner loan. What interest rate keeps the IRS happy under the section 482 rules? Is there a safe range tied to the AFR I can just...
Which services are NOT allowed under the Services Cost Method? Where is the line for 'cost-only'?
I understand the Services Cost Method lets me charge some intercompany services at cost. But I want to charge my US LLC for a bunch of things my home-country team does — some of it is bookkeeping and ...
Selling my partnership-LLC interest at a loss — can I stop the buyer from withholding 10%?
I'm exiting a US partnership-taxed LLC and will actually realize a small loss on the sale. The buyer's attorney still wants to withhold 10% of the price 'to be safe' under section 1446(f). Tying up th...
How long do I have to keep my foreign-owned LLC's records — is there a fixed number of years?
I want to clean up old files but I'm afraid of throwing out something the IRS will want. Is there a set retention period for section 6038A records, like seven years? My situation is messy because some...
What exactly goes in the section 6662 transfer pricing documentation, and is it really due to the IRS within 30 days?
I keep hearing that 'contemporaneous documentation' protects me from the transfer pricing penalty, and that I have to hand it over within 30 days if the IRS asks. What are the actual contents — is the...
My books live in Xero in Europe — can I keep my LLC's records abroad or do they have to be in the US?
All of my LLC's bookkeeping is in a cloud accounting tool hosted in Europe, and my contractor invoices and bank records are over here too. Does section 6038A require me to physically keep the records ...
If I can't produce my records in an IRS exam, can they really disallow my deductions and cost of goods sold?
I've always thought the worst case for a missing Form 5472 or bad records was the $25,000 penalty. But a friend said the IRS can actually throw out my deductions and even my cost of goods sold if I ca...
Can I keep my section 6038A records electronically, or do I need paper? Is a folder of PDFs enough?
I run everything paperless. My invoices, contracts, and bank records are all scanned into cloud folders, and my accounting is in software. Is electronic storage actually acceptable for section 6038A, ...
The IRS transfer pricing team wants our documentation in 30 days. Can we build it now, or have we already lost the contemporaneous-documentation advantage?
We have intercompany service fees between a U.S. corporation and a related foreign affiliate, and now the IRS has asked for transfer pricing documentation very quickly. Management is talking as if we ...
Have a similar question?
ForeignLLCTax members get expert answers with IRS citations. One CPA consultation costs $200+. Full access is $9.99/month.
Become a Member — $9.99/moDisclaimer: All content on ForeignLLCTax.com is created by a tax professional and is provided for general educational and informational purposes only. It does not constitute tax, legal, or accounting advice, and should not be relied upon as such. Every tax situation is different — for advice specific to your circumstances, please consult a licensed CPA, Enrolled Agent, or tax attorney. By using this website, purchasing a subscription, or accessing any tools or services, you acknowledge that no client-professional relationship is established between you and ForeignLLCTax.com or its operators. This website is not affiliated with the IRS.
