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It's perversely amusing to me that while an indiviual US citizen's overseas earnings are fair game for the IRS (and AFAIK no other country does this to their citizens), a corporation's earnings are totally invisible.

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The reason is because these companies have children who are native citizens of the other country, which the parent company has full control over. They give the children some asset (e.g. intellectual property) and pay them an allowance (e.g. license fees for the IP).

The IRS can't touch that money any more than they can touch the money of your Jamaican love-child.

The only other country to do this is Eritrea.

In 2013, the Canadian government expelled the Eritrean consul for illegal efforts at collecting that tax.

http://en.wikipedia.org/wiki/International_taxation#Citizens...

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