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Ask HN: Do you want a pre-made tax avoidance structure (ie Apple's Double Irish)

by husein10 on 11/8/13, 8:15 PM with 10 comments

Balaji Srinivasan's comments at this year's Startup School rekindled my interest in pre-made corporate structures that would help people minimize tax bills. I'm interested in gauging interest in this sort of thing among the HN crowd. A tax lawyer indicated that while making this pre-made structure was certainly possible, he couldn't see a lot of demand for it. I didn't feel like wasting time using deductive reasoning based on questionable assumptions when I could just get data to help answer the question. Would love to hear your thoughts on this.<p>See also: http://en.wikipedia.org/wiki/Double_Irish_arrangement

  • by philiphodgen on 11/8/13, 8:30 PM

    In order to gauge interest on HN you will need to tell them the price -- setup and annual maintenance.

    Then compute the estimated tax savings. "Savings" means the present value of a deferred tax liability. Until the tax deferral is large this value is not worth chasing. Especially since the true cost is not in the money. It is the distraction to management.

    It's a good idea. But compute the cost/benefit.

    Disclaimer. I am an international tax lawyer. I fix these things when people fuck 'em up because they don't spend money on the maintenance.

    Further. I really like the idea though. Much of the bespoke international tax stuff can be standardized and product-ized. If you pursue this idea do your analysis assuming setup costs are zero. They won't be but try it out. Assign all of the costs to annual maintenance. Assign a price to the penalty risks if the maintenance fails. See where your break even is. My guess is you won't bother until the foreign income generates US net (of foreign tax credit) tax liabilities of a couple of million a year.

    Another idea -- offshore structures in a box for holding IP, especially IP under development.

    Hold on. I'm at Chipolte. Must run to register internationaltaxlawyerinabox.com. :-)

  • by qsymmachus on 11/8/13, 8:23 PM

    Why do Balaji Srinivasan and his admirers seem to share so much in common with Tea Partiers? At least the small government crowd (seems) to stand on principle, rather than just angle for new ways to make money. Don't try to weasel your way out of paying taxes.