- 74 - Fixed facilities, (2) management activity, (3) agent activity, (4) employee activity, and (5) office or other fixed place of business of a related person. Sec. 1.864-7, Income Tax Regs. We examine each of the factors in turn. (1) Fixed facilities. The general rule is that "an office or other fixed place of business is a fixed facility, that is, a place, site, structure, or other similar facility, through which a nonresident alien individual or a foreign corporation engages in a trade or business." Sec. 1.864-7(b)(1), Income Tax Regs. "A fixed facility may be considered an office or other fixed place of business whether or not the facility is continuously used by a nonresident alien individual or foreign corporation." Id. Furthermore: A nonresident alien individual or a foreign corporation shall not be considered to have an office or other fixed place of business merely because such alien individual or foreign corporation uses another person’s office or other fixed place of business, whether or not the office or other fixed place of business of a related person, through which to transact a trade or business, if the trade or business activities of the alien individual or foreign corporation in that office or other fixed place of business are relatively sporadic or infrequent, taking into account the overall needs and conduct of that trade or business. * * * [Sec. 1.864-7(b)(2), Income Tax Regs.] (2) Management activity. The regulations take into account where the "top management" decision-making takes place and where "the day-to-day trade or business of the foreign corporation” occurs. Sec. 1.864-7(c), Income Tax Regs. (3) Agent activity. The regulations provide:Page: Previous 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 Next
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