Latin America Cross-Border Tax
Latin American cross-border situations can fall into any of our four service areas depending on who you are and where you fit. This page gives a brief overview of each, with country-specific pages below for Mexico, Brazil, Colombia, Argentina, and Chile.
U.S. Individuals with Latin American Ties
U.S. residents and dual citizens who own businesses or financial accounts in Latin America carry annual reporting obligations that apply regardless of where they live. The most common issues are foreign entity reporting and foreign account disclosure.
- Form 5471 for ownership in Latin American corporations (SA de CV, SAS, S.A., Ltda.)
- Form 8865 for interests in Latin American partnerships
- Form 8858 for foreign disregarded entities or branch operations
- FBAR and FATCA for foreign bank and investment accounts
- Subpart F and GILTI analysis for controlled foreign corporations
- Foreign tax credit coordination where Latin American tax has already been paid
- Pre-immigration restructuring for those planning to move to the U.S.
U.S. Expats Living in Latin America
Americans living in Latin American countries still file a U.S. return every year. The main planning question is usually whether the Foreign Earned Income Exclusion or foreign tax credits produce the better result, which depends heavily on the local tax burden in the country where you live.
- FEIE and housing exclusion analysis
- Foreign tax credit vs. FEIE comparison
- FBAR and FATCA for local accounts
- Treaty benefits where a U.S. tax treaty is in force (Mexico and Chile have treaties; most others do not)
- Social security totalization where applicable
- State residency and domicile issues
Foreign Business and Investors from Latin America
Latin American nationals forming U.S. businesses or making U.S. investments face a different compliance picture than domestic owners. The inbound work usually starts with entity setup and grows from there.
- U.S. LLC formation and structure analysis
- EIN and ITIN applications
- Form 5472 compliance for foreign-owned single-member LLCs
- U.S. tax return filing for inbound structures
- Treaty analysis where applicable (most Latin American countries do not have a U.S. income tax treaty)
- Back-office support for setup, renewals, and ongoing filings
U.S. Real Estate Owned by Latin American Investors
Latin American buyers of U.S. real estate are subject to U.S. tax on rental income and FIRPTA withholdings on sale. The right setup from the start avoids the default withholding regimes that apply without the proper elections and filings.
- FIRPTA withholdings on sale and withholding certificate applications
- Net income election for rental property to avoid gross withholding
- Form 1040-NR, ITIN support, and state returns
- LLC formation, annual renewal, U.S. mailing address, and bank setup
- Estate tax review for U.S.-situs real property
Who This Is For
This page fits dual citizens and U.S. residents with Latin American business interests or financial accounts, Americans living in Latin America, Latin American nationals investing or operating in the U.S., and Latin American buyers of U.S. real estate.