David Fedeles
Office: (340) 773-4665 x18
Toll Free: (800) 964-9755 x18
Residence: (340) 773-9697
Fax: (340) 773-8989
Email: david@fedeles.com
Stephanie Schoyer
Licensed Sales Assistant
Office: (340) 773-4665 x17
Toll Free: (800) 964-9755 x17
Email: stephanie@fedeles.com
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Business Information — edc
IRS NOTICE TO EDC BENEFIARIES
The IRS sent a notice to those companies based in the USVI and taking local tax exemptions (known as EDC companies) warning against using the program as an illegal tax shelter. The warning questions personal residency issues as well as “source” income and that the income generated should be “effectively connected” to their USVI operation and not stateside derived. In addition, the notice put “promoters” of the program on warning under penalty of prosecution that they not misrepresent the tenets of the incentives and how they are to be utilized. The full report by the IRS can be found at www.treas.gov/press/releases/reports/noticejs1743.pdf.
USVI ECONOMIC ALLIANCE
Ben Rivera, Executive Director of the recently created “Alliance”, says the Alliance seeks to promote and to properly disseminate information regarding the EDC program to members and prospective new EDC entities in the USVI. As a result of the recent IRS warnings, the Alliance attended a forum with local EDC beneficiaries hosted by Lt. Gov. Vargrave Richards on July 8th along with local and DC-based government and IRS attorneys, to discuss the challenges and impacts of these rulings and how to continue the forward momentum with the program, reiterating the Governor’s pledge to fully support it. Local legislation is being developed to define residency, but the administration’s intent is to support the definition of residency through the US Congress which is on the floor now. Mr. Rivera met Stephanie Strom, a NY Times reporter writing an expose of the program and its impact on the USVI, in early August and showed the positive impact of the program on the local economy in both the real estate market with a commercial building surge in both towns and the residential market, as well as the increases in local employment and spending as generated by these EDC entities. I am pleased to note that I will be an allied member of the Alliance, Inc. and you may contact me for additional information or directly to Ben Rivera at 340-773-4120 or via email at info@usvialliance.org .
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