Understanding Commercial Property Investment

The effectively connected income of a foreign corporation or international investor is taxed on a net basis at graduated rates like those applicable to U.S. corporations, citizens, and residents. Generally, U.S. source income is ECI if one of two alternative tests -- the business-activities test and the assetuse test -- is met. The business-activities test looks to whether the activities of the U.S. business are a material factor in generating the income. The asset-use test looks to whether the income is derived from assets used or held for use in the conduct of a U.S. business. Both tests are applicable to income from real estate....
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Understanding Commercial Property Investment