Question
On January 1, 2022, Lucas Stag, a U.S. citizen, contributes US $15,000,000 to a Hong Kong (HK) company called Dolan Hong Kong Private Limited Company.
On January 1, 2022, Lucas Stag, a U.S. citizen, contributes US $15,000,000 to a Hong Kong (HK) company called Dolan Hong Kong Private Limited Company. Lucas Stag timely files a Form 8832 to check-the-box to be characterized as a foreign disregarded entity (FDE) for the HK entity. The Chartered accountants in Hong Kong provide the following account information in Hong Kong dollars for the year ended December 31, 2022.
Sales | HK$25,000,000 |
Cost of Goods Sold | HK$15,000,000 |
Compensation | HK$2,000,000 |
Cash | HK$31,400,000 |
Accounts Payable | HK$15,000,000 |
The average exchange rate is $2 H.K. to $1 U.S. Please complete the Form 8858 Information Return for this foreign disregarded entity.
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