A. No. Generally, the rules are the same as they are for fees paid to a U.S. firm or individuals. You can deduct the “ordinary and necessary” expenses of your business, even if they’re paid to foreign sources. Be sure to keep adequate records of the expenses—such as canceled checks and invoices—to prove that the amounts you’ve paid represent fees for legitimate business services. Tip: Use Form 1042 to report the fees. The form is available at www.irs.gov/pub/irs-pdf/f1042.pdf.
- How to Fire an Employee the Legal Way: 6 Termination Guidelines
- Small Business Tax Deduction Strategies
- Jump-start business deductions for family-owned cars
- Rein in workers' compensation costs
- Learn the tax lay of the land, and turn casualty losses into tax gains
- 40% of workers would quit if not for health benefits