Cross-Border Tax Planning: Avoiding Costly Deal Structure Mistakes

David Brandon
Attorney, Tax

Abstract
When companies move quickly into new markets, speed can create opportunity—but it can also lead to expensive tax mistakes. David Brandon, a tax partner in the Boise office, explains why businesses expanding into the United States should treat tax planning as a strategic part of the deal process rather than a last-minute diligence item.

The discussion highlights a common challenge for non-U.S. companies: relying on home-country assumptions or finalizing a transaction structure before involving local tax counsel. Once a deal structure is crystallized, opportunities to improve the tax outcome may be limited, leaving advisors focused on damage control instead of proactive planning. For legal and business leaders, the takeaway is clear: early tax planning can preserve flexibility, reduce risk, and avoid costly reversals.

Transcript

I am David Brandon. I'm a tax partner in our Boise office, and my practice is focused on tax planning, so I'm usually involved with planning the consequences of significant transactions for businesses. If a client wants to move into a market quickly, because speed is a competitive advantage in some cases, there's a tendency to want to jump the gun, take shortcuts or import all of the assumptions that work in your home country to your new expansion country. And what ends up happening is those assumptions can lead to cut corners. They can lead to making decisions that are irreversible or reversible at really high costs. And frequently what I see is when a company is moving too quickly and is not asking the right questions and is not treating tax as a strategic support to their overall business plan, it puts us into a box where all we're doing is damage control, and damage control is so much more expensive. It's the phrase, an ounce of prevention is worth a pound of cure. And so, frequently what I've seen in my practice recently is a non-US company eager to make an investment into the United States, and they'll bring in local counsel sort of at the last minute to diligence the assets of the company, but it's already after the structure of the deal itself has been crystallized. And once you've created that crystallization around the structure, our flexibility to create a better tax result goes out the window. And really at that point, like I said, we're really just focused on damage control. We're not focused on how do we give you the best result there is, and damage control is always expensive.