According to the WSJ there's a funny thing happened about the
estimated $1.7 trillion that American companies say they have indefinitely
invested overseas: A lot of it is actually sitting right here at home.
Some companies, including Internet giant Google, software maker
Microsoft and data-storage specialist EMC Corp., keep more than three-quarters
of the cash owned by their foreign subsidiaries at U.S.
banks, held in U.S. dollars or parked in U.S. government and corporate
securities, according to people familiar with the companies' cash positions.
In the eyes of the law, the Internal Revenue Service and
company executives, however, this money is overseas. As long as it doesn't flow
back to the U.S. parent
company, the U.S.
doesn't tax it. And as long as it sits in U.S. bank accounts or in U.S.
Treasurys, it is safer than if it were plowed into potentially risky foreign
investments. In accounting terms, the
location of the funds may be just a technicality. But for people on both sides
of the contentious debate over corporate-tax reform, the situation highlights
what they see as the absurdity of rules that encourage companies to engage in
semantic games, legal gymnastics and inefficient corporate-financing methods to
shield profits from U.S.
taxes…..
Read all about it at http://online.wsj.com/article/SB10001424127887323301104578255663224471212.html?mod=WSJ_hp_LEFTWhatsNewsCollection
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