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    Foreign Currency and Currency Exchange Rates

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    butterfly
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    Posts : 52311
    Join date : 2013-01-17

    Foreign Currency and Currency Exchange Rates

    Post  butterfly on Tue 26 Feb 2013, 13:07

    http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Foreign-Currency-and-Currency-Exchange-Rates
    Foreign Currency and Currency Exchange Rates

    You must express the amounts you report on your U.S. tax return in U.S. dollars. If you receive all or part of your income or pay some or all of your expenses in foreign currency, you must translate the foreign currency into U.S. dollars. How you do this depends on your functional currency. Your functional currency generally is the U.S. dollar unless you are required to use the currency of a foreign country.
    You must make all federal income tax determinations in your functional currency. The U.S. dollar is the functional currency for all taxpayers except some qualified business units (QBUs). A QBU is a separate and clearly identified unit of a trade or business that maintains separate books and records.
    Even if you have a QBU, your functional currency is the dollar if any of the following apply.
    You conduct the business in dollars.
    The principal place of business is located in the United States.
    You choose to or are required to use the dollar as your functional currency.
    The business books and records are not kept in the currency of the economic environment in which a significant part of the business activities is conducted.
    Make all income tax determinations in your functional currency. If your functional currency is the U.S. dollar, you must immediately translate into dollars all items of income, expense, etc. (including taxes), that you receive, pay, or accrue in a foreign currency and that will affect computation of your income tax. Use the exchange rate prevailing when you receive, pay, or accrue the item. If there is more than one exchange rate, use the one that most properly reflects your income. You can generally get exchange rates from banks and U.S. Embassies.
    If your functional currency is not the U.S. dollar, make all income tax determinations in your functional currency. At the end of the year, translate the results, such as income or loss, into U.S. dollars to report on your income tax return.
    Currency Exchange Rates
    An exchange rate is the rate at which one currency may be converted into another, also called rate of exchange of foreign exchange rate or currency exchange rate. Below are government and external resources that provide currency exchange rates.
    Governmental Resources
    Treasury Department's Currency Exchange Rate
    Federal Reserve Bank
    U.S. Department of Agriculture
    External Resources
    Oanda.com
    xe.com
    x-rates.com
    References/Related Topics
    Miscellaneous International Tax Issues
    Yearly Average Currency Exchange Rates

      Current date/time is Sat 23 Sep 2017, 10:39