This flowchart provides an overview of the rules to determine when gross income is effectively connected with a U.S. trade or business ("ECI") and whether U.S. source FDAP income is subject to a gross 30% U.S. tax.
A key factor in applying these rules is whether the income is from U.S. sources or from foreign sources. We have separate flowcharts on sourcing of income. Another important factor is whether the non-U.S. person is engaged in the conduct of a trade or business in the United States ("ETB"). We have a separate flowchart regarding whether a non-U.S. person is ETB.
Flowcharts are automatically emailed as PDF files to purchasers. If you have not received an email within one hour of your purchase, please Email Us.