International Tax

What is tax equalization?

Tax equalization is a process where a U.S. employer makes a U.S. employee "whole" for any differential in taxes resulting from a foreign assignment. It removes the risk of higher taxes for the employee if he/she chooses to take the foreign assignment.

Under a tax equalization program, a U.S. employee would be reimbursed by his/her employer if the employee’s taxes are higher then if he/she stayed in the U.S. Alternatively, if the taxes were lower, the employee would reimburse the employer for the difference.

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