AM Schweser practice exam 1, question 8-b country, question, practice, only

pawn

Answer says US is a source jurisdiction country. cFAI text volume 2pg. 252 says "only 3 of the 37 jurisdictions surveyed with income taxes have territorial-based systems, aka source jurisdiction, (hong kong, Singapore, and Taiwan).

Did anyone else notice this?

liangfeng

Paraguay Wrote:
-------------------------------------------------------
> jorgeam86 Wrote:
> --------------------------------------------------
> -----
> > Answer says US is a source jurisdiction
> country.
> > cFAI text volume 2pg. 252 says "only 3 of the
> 37
> > jurisdictions surveyed with income taxes have
> > territorial-based systems, aka source
> > jurisdiction, (hong kong, Singapore, and
> > Did anyone else notice this?
>
> I think it is a hypothetical. If you memorized
> that, that is pretty amazing.

Obviously I didint memorize it. My mom is a US citizen who lives and works abroad and I know she pays US income taxes so I went with residence jurisdiction. I was surprised when the schweze answer said source so I checked the cFAI text. Errata makes no mention of it either...

strikethree

I mean I think it is a hypothetical in that source is where the money is coming from, residence is where the couple was located.

USA is often source of foreign income that taxes are collected on for external investors. Same as Europe to the USA. I don't get why the book says only 3 countries.

PalacioHill

Paraguay Wrote:
-------------------------------------------------------
> I mean I think it is a hypothetical in that source
> is where the money is coming from, residence is
> where the couple was located.
>
> USA is often source of foreign income that taxes
> are collected on for external investors. Same as
> Europe to the USA. I don't get why the book says
> only 3 countries.

Ok again verbatim from the cFAI text( vol 2, pg 252): "the US is a notable exception given that both citizens (regardless of where resident) and residents are subject to US taxation on their worldwide income." clearly if ur a$$ gets taxed on worldwide income regardless of where ur located, it can't be source. Might be reading too much into this. Moving on...