united-states international tax-law
How are businesses based outside, but doing business inside of the US taxed?
<p>I am looking specifically for how the U.S. taxes businesses that originate from another country, but are doing business within the U.S., with or without operations taking place at a permanent address in the U.S. The source for this information should preferably be a .gov website. </p>

<p>They are generally taxed on the portion of their income that is <a href="https://www.irs.gov/pub/int_practice_units/ISI9422_01_01.pdf" rel="nofollow noreferrer">effectively connected with the United States</a> at the same tax rates that apply to domestic C corporations. But, this can be modified in some cases by tax treaties with the country where the corporation is incorporated.</p>

<p>The definition of what constitutes "<a href="https://www.irs.gov/individuals/international-taxpayers/effectively-connected-income-eci" rel="nofollow noreferrer">effectively connected income</a>" is a bit arcane but basically involves income from either real estate or an active trade or business within the United States, as opposed to passive financial instrument income such as interest on a bond or promissory note, dividends, or capital gains on the sale of a security. There are many gray areas, which international tax lawyers make their livings cultivating and navigating.</p>
