# Foreign Insurance Excise Tax



## adsmall (Mar 1, 2014)

Is anyone aware of the foreign insurance excise tax that the IRS charges Americans on insurance policies purchased in Canada (and other foreign countries). The tax is 1% of the premium paid and must be paid quarterly via Form 720. I am unsure whether this tax applies to individuals (like me - an American who lives/works in Canada) or just businesses. The instructions to Form 720 seem to be geared toward businesses but in the "Who Must File" section it says that any person who pays a premium to a foreign insurance company must file. It is interesting though, it goes on to say that if the individual paying the insurance does NOT file, then it is the foreign insurance company's responsibility. It does not appear to me that the US/Canada Tax Treaty deals with this topic. Thanks!


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