Tax Implications of Dividend Distribution to Foreign Holding Company under US-UK Tax Treaty

There are at least 3 issues that can be fully analyzed for full credit (4 points each).  Responses must be in the IRAC format (see module 1 materials if you still are not aware of what this is) and you must cite authority for the rules you discuss. 
Remember – the homework assignments are focused on the rules that were the topic of this week’s lecture.  You don’t get points for off topic issues, so don’t waste your time.
You must use (and cite to) the US-United Kingdom tax treaty for this analysis.  Do not rely on the class slides that discuss the US model treaty.  The US-UK treaty is available in Checkpoint
Dorie, Ellie, and Bonnie, own equal shares of 3Queens Ltd., which is a company incorporated in the United Kingdom.  The three friends met while in college, but Dorie and Ellie are both UK citizens living in London and are subject to UK taxes.  Bonnie, on the other hand, is a Swiss national living in Geneva.  3Queens Ltd. was formed as a holding company for Dorie, Ellie, and Bonnies to make joint investments through.  The company does not make any deductible payments to anyone.  
In 2019, 3Queens Ltd. invested in an American corporation, Eagle, Inc., which was formed and operates in Florida.  Eagle, Inc. manufactures and sells soccer balls in the US.  Eagle, Inc. has seen a significant spike it its sales and profits ever since Messi joined Inter Miami FC, driving up the  popularity of the sport.  As such, the company has decided to issue a dividend to its shareholders.    
3Queens Ltd. owns about 12% of Eagle, Inc. and its share of the dividend will be about $180,000.  The dividend will be issued next month, so Dorie reaches out to you on behalf of the company to see if there are any US tax considerations regarding the dividend. 

The post Tax Implications of Dividend Distribution to Foreign Holding Company under US-UK Tax Treaty appeared first on get essay fast.