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Buying Foreign Stocks
Our club is considering purchasing stock in Canadian company Aurora Cannabis (ACBFF), which is slated to trade on the NYSE as ACB by the end of this month. Our question regards taxes. How does owning foreign stocks complicate our taxes, if at all? Thank you for your input. 

Vickie
We used to own Canadian National Railway.  They withhold a portion of any dividend paid.  You bookkeep it and distribute it to the partners on the K-1.  They use it to reduce US taxes, usually an insignificant amount.

Joe

On Oct 10, 2018, at 11:18 PM, Vickie Rabourn via bivio.com <user*26711600001@bivio.com> wrote:

Our club is considering purchasing stock in Canadian company Aurora Cannabis (ACBFF), which is slated to trade on the NYSE as ACB by the end of this month. Our question regards taxes. How does owning foreign stocks complicate our taxes, if at all? Thank you for your input. 

Vickie

Vicki,

For taxable accounts the problem is just a matter of accounting for any foreign taxes paid when you do your taxes.
For non- taxable accounts (IRA’s etc) it could create an unnecessary loss.
The reason is if the foreign country withholds taxes there is no way to get credit for the withheld taxes.

Shell is a example when one share type (RDS.A) represents one country and another share type (RDS.B) represents a different country.

In this case it is safe to hold the RDS.B in a non-taxable account as the RDS.B shares are British and there is no withholding.
The RDS.A shares are dutch and they do withhold.

Bob
> On Oct 11, 2018, at 12:18 AM, Vickie Rabourn via bivio.com <user*26711600001@bivio.com> wrote:
>
> Our club is considering purchasing stock in Canadian company Aurora Cannabis (ACBFF), which is slated to trade on the NYSE as ACB by the end of this month. Our question regards taxes. How does owning foreign stocks complicate our taxes, if at all? Thank you for your input.
>
> Vickie
Hi,

First of all, you would not want to buy a foreign stock that was not traded on a US exchange as an ADR.

You could keep records in bivio for many of them, but it's important to understand that because they are foreign stocks, they do bring with them the potential for accounting issues arising should they undergo any sort of reorganization or special distribution.

Foreign companies often do not provide information on the US tax implications of such events. This may cause delays and problems in being able to update your club information on a timely basis.

It becomes up to your club to determine whether the potential for extra work or delays getting your records updated correctly is something you are comfortable with.

Laurie Frederiksen
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Many thanks to Laurie Frederiksen, Joe, and Bob for your replies. Your helpful input will make our club's decision to buy or skip ACB easier. ~Vickie


On Thursday, October 11, 2018 9:06 AM, Laurie Frederiksen <laurie@bivio.biz> wrote:


Hi,

First of all,  you would not want to buy a foreign stock that was not traded on a US exchange as an ADR.

You could keep records in bivio for many of them, but it's important to understand that because they are foreign stocks,  they do bring with them the potential for accounting issues arising should they undergo any sort of reorganization or special distribution.  

Foreign companies often do not provide information on the US tax implications of such events.  This may cause delays and problems in being able to update your club information on a timely basis.

It becomes up to your club to determine whether the potential for extra work or delays getting your records updated correctly is something you are comfortable with.
Laurie Frederiksen
Invest with your friends!
www.bivio.com

Become our Facebook friend!  www.facebook.com/bivio
Follow us on twitter!  www.twitter.com/bivio
Follow Us on Google+

Click here to Subscribe to the Club Cafe email list.  Click here to  Unsubscribe