The tax treaty between France and the US provides that US citizens having their tax residence in France are allowed to deduct tax paid in France from their US tax liability.
Although this deduction applies to personal income tax, the Internal revenue Service (“IRS”) considered, since 2008, that it was not applicable to the contribution sociale généralisée (“CSG”) and to the contribution pour le remboursement de la dette sociale (“CRDS”) given that it considered CSG and CRDS as social charges.
On June 14, 2019, the IRS has finally admitted that CSG and CRDS constitute creditable income taxes that can therefore be deducted, by US citizens, from their US tax liability.
US citizens, who have been subject to CSG and CRDS over any of the last 10 years, i.e. since 2009, are therefore in position to claim these CSG and CRDS amounts as foreign tax credits and to request refunds of the corresponding overpayments of US taxes.
We will be happy to liaise with their US tax adviser, if need be.
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Claire Guionnet-Moalic Avocat Associé ■ Partner Tel. +33 1 56 59 88 88 ■ Direct +33 1 56 59 88 80 Mob. +33 6 84 61 67 30 36, avenue Hoche ■ 75008 Paris ■ France
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Arnaud Bonnard Avocat Counsel ■ Droit Fiscal Tel. +33 1 56 59 88 88 ■ Direct +33 1 56 59 88 86 Mob. +33 6 89 42 68 53 36, avenue Hoche ■ 75008 Paris ■ France
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