Turnkey IC-DISC Services

Export Assurance provides turnkey solutions to take advantage of the beneficial export tax provisions provided by an IC-DISC. Included in our package are the following services:

1. Retaining at our expense tax, legal accounting and specialized administrative services for your exporting activities. Export Assurance designs, structures, forms, and operates your IC-DISC to address the structuring of the IC-DISC arrangement, and advising on:

(i) IRS required transfer pricing requirements and/or commissions with respect to the IC-DISC operations;

(ii) the calculation of income from your exporting activities, after allocating selling, general and administrative expenses and utilizing "Marginal Costing Rules", as set forth in the regulations in a manner designed to achieve the desired tax results of the planning and the timely payment of the computed commission to the IC-DISC;

(iii) the calculation of your "Export Promotion Expenses" under the regulations;

(iv) whether the IC-DISC should pay dividends on the portion of its earned commissions not "deemed" to be a dividend, or defer payment of the dividend, which then requires the timely payment of interest to the IRS (adjusted annually to reflect the "base period T-bill rate") based upon the deferred tax calculated at ordinary income tax rates;

(v) "Producer's Loan" issues, including computation of an arm's length interest charge under §482 in the case where dividends are deferred and the IC-DISC retained earnings are loaned back to your export company, allowing the untaxed monies in the IC-DISC to be utilized by your company for its operations, and drafting and administering a conforming secured loan facility on behalf of the IC-DISC; and

(vi) state and local tax issues in order to minimize such taxes on the IC-DISC.

2. Designing, forming and organizing the IC-DISC under appropriate state law, along with its corporate minute book including by-laws, articles of incorporation, minutes, issuance of stock certificates, etc. in an appropriate and agreed to jurisdiction and maintaining a registered office in such location.

3. Drafting and maintaining the documentation related to the IC-DISC planning, including: (i) the commission or sales agreements in support of your export activities and it's relationship to the IC-DISC; and (ii) Producer's Loans agreements.

4. Retaining at our expense for you and oversee the CPA selected, as discussed above, who will draft the appropriate IC-DISC federal and state tax returns, as required, for review and revision and ultimate completion, signature and filing.