Episode 89: The Intersection of Immigration and Taxation with John Apuzzo

[00:00:00] Hi everyone. It's Evelyn Ackah from the Ask Canada Immigration Lawyer Podcast. I'm so excited today. I have the pleasure of introducing you to John Apuzzo. Hello, John. Hello, Evelyn. Hi, everybody. So nice to have you with us. Um, John is an international tax leader and a partner with the accounting firm of MGO.

And he is based in the United States. You're in California, right? Yes, I am. Yes. Lucky man. John is a Canadian, um, originally, and now he lives in the States and he's done a lot of different things. I want to talk about his background. He has collaborated with clients for over 25 years in public accounting and worked for major, large organizations and accounting firms.

Some of them we have in common, I think, even before he joined MGO, he had worked at CPA firms in several countries, gaining experience in cross border [00:01:00] taxation strategies, foreign jurisdictions, corporate and family office restructuring. Supply chain, treaty analysis, and more. And since I'm a cross border immigration lawyer, I thought it would be wonderful to have John join us to talk about his background, his firm, MGO, and also to tell us about what he does and how it could benefit some of our cross border business clients.

Hi, John. Hey, Evelyn. So, listen, I'm going to start gently with you. Talk about your journey. How did you get into international tax? Who does that? Well, put it this way, uh, you know, I basically started off in Montreal where I was born and raised out of Italian parents. Now I do have three citizenships, you know, and so I live it every day.

But when I first started, um, you know, I got licensed in Canada, uh, one of my professors said, Hey, why don't you go get the CPA? So I got the CPA in the [00:02:00] U. S. as well. So I'm licensed on both sides. And you know what? I just started, I started with teaching. I started teaching and I taught part time, you know, in Canada, it's very customary that you teach at night and you practice in the day.

And then I sort of said, well, I want to get some U. S. experience in the U. S. And when I came here to California, it was supposed to be part time. I ended up staying. I'm still here. I love the weather. Uh, and, but I do come back, you know, I travel to Canada. I travel to Italy annually. And I'm very well traveled.

So I love traveling the world. And that's what keeps me interested, you know, just, uh, knowing how the rules and helping people, just helping people with what is really complex, but not impossible to get around. Oh, I love that. So you have three citizenship. So you understand the immigration journey. I can imagine.

Yes, I do. For yours in the U. S., it must have been sad, you know, something, because we know how hard [00:03:00] it is. But Italy, was Italy easier? Italy was easier because I got it by, uh, Uh by blood, right? Yeah, my dad was I was born before, you know, so, uh with italian bloodline So I I got that one. It still was about this because it is italy and it takes the bureaucracy takes forever But I have it.

I love it. I'm so jealous. So listen, I want to ask you um, tell us a little bit about mgo because it's not uh firm that before you I had heard of here in canada because It's you are you aren't in canada, right yet. Are you? No, we're, we're a regional firm in the U S we basically have people in every state.

We don't have offices in every state, but we do have people in every state. Um, we are, uh, the firm was basically a, uh, we have a large presence in cannabis and auditing of cannabis. Obviously, if you understand anything about international tax. [00:04:00] Most countries, except for Canada and the U. S., it's illegal to have any cannabis.

So, this is one of the reasons why they brought me on to expand. You know, uh, the business and have less reliance on one particular industry. So, uh, the firm is growing, we're, we're definitely getting more and more, uh, service line and with me being here, the, the international tax has just exploded in terms of what, what the offering we can bring.

And the lucky part that I have is I've got excellent partners in other areas like in federal, uh, research and development. And I, we normally, we normally. You know, collaborate with foreign offices with foreign firms, so they're not NGO, but foreign offices and we we have a nice collaboration to make sure that our clients are well served.

That sounds so great. I think it's a great idea. And I've had some clients that do cannabis and I can tell you that it is a struggle, you know, finding it really is even crossing [00:05:00] the border. Even if you work in the business, they, they're like, Oh, much less accounting. So I think it's fabulous and that you're growing the business.

So listen, what motivated you? I know you told me about. Um, how the teacher recommended you did this back in university, but what motivated you, John, to specialize in international tax planning and restructuring, particularly for high net worth individuals and global businesses. So, like I said, I first started out of, um, a teacher that was at McGill university, where my alumni in Montreal told me to get this.

And then, so I ended up, I was going for my CPA, now CPA, it was called Chartered Accountancy before, in Canada, and so I was getting the U. S., and then, what typically happened is, you know, I, I, I had to article and audit, so I did my audit hours, I was teaching the Canadian Tax and U. S., and the, uh, I was a teacher for Becker CPA Review, and so I was doing both, and what kept me interested, to be honest with you, I was [00:06:00] like, The court cases like especially the court case i'm like, oh my god I wish I came up with that idea and you were reading all of these things and how people Uh get really aggressive with the rules without breaking them And so that really kept me interested and to be honest with you today that you know, i'm well seasoned Uh, what keeps me doing it is is the pleasure that I see in helping Small, medium sized businesses.

Uh, 'cause a lot of what I do is, was sort of always kept in big four, like the large accounting. But by bringing this to, to this platform, the appreciation that I get from my clients to say, oh my God, thank you for the help. It is just a breath of fresh air to say. You know what i'm actually you're actually helping people and that's what keeps me in it.

Uh, You know just getting every day, of course the tax court tax court cases are still interesting You know what? I don't get bored, [00:07:00] but it's the people, you know, this is definitely a people business And although I like the technical aspects of it I love breaking it down and making it very simple for my clients.

Oh my God, John, I wish I had you when I started my practice, because as you know, you'd probably deal with a lot of professionals and small and medium businesses, but they don't understand anything about, you know, like I went to law school because I don't know math, you know, it's like, there's a reason and accountants is just why I thought I really wanted you on.

They make things. Interesting. And also bring it down and make sure it's relatable. Because if I don't understand, I'm just going to trust my accountant. And then if I don't get it, I don't understand what they've done. I can't even explain it. If I get audited, you know what I mean? Right. And, and that's what I pride myself in is like, I tell people, look, You don't have to go get the degrees and all that you're relying on me pick my brain So that you can make an informed [00:08:00] decision And so, you know, it's sort of like when I go to a doctor I go you tell me with your knowledge What it is and i'll decide, you know the cure and the treatment that suits me and that's how I and people truly appreciate that because they're like Oh, this is not that hard, right?

And the years of, of teaching really helped that with teaching, you know what you have a really those students, you know what the, the light goes up and that's satisfactory. But with, with the clients, it's, They have that business sense. So they're halfway there. You just have to take them the other half and say, Hey, with this, uh, particular issue you want, here's, here's what I would look at, but also consider the other stuff of your business and let's, I sort of partner with them to help them make the better decision for them.

Oh, I love that so much. This is really, really good. So listen, from your experience, um, what are the most common tax challenges faced by immigrants [00:09:00] and businesses operating in Canada and the U S even like when you moved, let's say, take it from a personal perspective, you've moved from Canada to the U S and then you have to file in both countries.

Like that's the limited level that I know. And then I say, you need John, you know, you need an accountant, please. Um, what are the most common issues or challenges they might have? I think most people, like everything else, like, you know what, when you say, how does this taste? We always say the same thing, if you don't know, it tastes like chicken, right?

Everything tastes like chicken. And so the issue then, you tend to come to a different country, whether it's an American going to Canada or a Canadian coming to the U. S., you think that the system works the same. And that's where I'm like, no, it doesn't Canada is very congruent, meaning the province will generally follow the Fed, right?

It's very rare that the province will misalign. Yes. Whereas [00:10:00] here in the U. S. It's I tell my client welcome to the not so United States of the United States It's not congruent whatsoever and you sort of have to be Comfortable with speaking on both sides of your mouth and then it's like sort of like in order to get a lease you need to Get the business license, but in order to get the business license, you need to get the lease So which comes first the chicken or the egg?

And we're so you as an American being here from now over 20 plus years, you get used to that. And that's why I, you know, I have to coach my Canadians. Hey, by the way, this is how it sort of works here. Start getting comfortable, start getting fresh and same thing vice versa. You know when an american goes to the u.

s. I go listen, they're not as legal, right? It's a handshake. That's still sort of work To a certain like, you know, it's just the cultural differences. Although we're you know, we're neighbors and I happen to be both Oh, [00:11:00] yeah, there definitely is cultural differences and it really shows shows up in the rules Like that's what I found interesting and reading the court cases reading the it says a lot about culture It says a lot about how?

People think and how they go about it. And so, you know, when in Rome, do as the Romans. And so I tried to, uh, get my clients comfortable first and foremost. I go, listen, the technical rules, don't worry about it. You've got people like us that will break our heads for you, but start getting used to, cause you have to make decisions as we move along when your business successful.

Yeah. And especially if they come and see you, which is why we always say is before we do anything, if it's an intercompany transfer, whatever it's, if you're setting up a new business, you need to talk to the accountant first. Before we do anything on immigration, we need to talk to the accountant first, get your advice, get your strategy, all of that.

And then when you get that, you come and then we'll be happy to do the immigration. Because if you do it wrong on the immigration side, then you have to unravel it all for the tax side, right? [00:12:00] That's a little I know after my 25 years doing this. Um, so listen, um, right now, what, what about changes in tax treaties and cross border regulations?

I mean, I'm not looking for us to get deep into the weeds cause I don't know anything, but what are you seeing right now? Are you feeling anything new and exciting? Now we have a new us president talking tariffs. You must get a lot of people calling you worried about that. Absolutely. And so the first thing that I tell everybody is first and foremost, you, you know, you and your business.

Is the most important right that something happens to somebody else it really won't impact you so forget about the fluff Just worry about you and what the issues are for you right now. Obviously. Yes tariffs Is what on everybody's mind but what people don't realize tariffs have been around forever And so countries have used tariffs to sort [00:13:00] of negotiate public policy and stuff like this and what people have to realize is that the trump administration Did figure out that some countries have used tariff for their benefits and from an American perspective We're paying into their pockets and not Vice versa on an equal basis.

So notice there are patterns going back and forth, but back and forth not equal And so this is why You know, like every country in the world that's trying to recoup from the COVID era. And you know what, like being in California, which is the highest taxed state in America. There's only so much more you can go on income tax.

So they have to pull different levers. And what I tell my clients, look, tariffs has to do with customs and duties. There's general agreements on trade and tariffs. What you want [00:14:00] to do with if you're in the service industry probably won't impact you very much. That's right. If you're in clothing, you know, and in the garment industry, they've already done that to a maximum, uh, extent, but on certain other items.

Um, notice Trump has thrown out a couple of countries saying, Oh, I have to go get, but they're going to have to negotiate, right? They're going to have to negotiate. There might, there might not be some retaliation or whatever, but look, you know, stay abreast of the rules and say, Hey, is there anything happening in my area that will impact me?

So if you're in the technology business, is there any new taxes? Like Canada did a new digital tax, right? Yeah. And so is that anything there like canada also has a relatively new real estate thing if a foreigner wants to buy in We're not going to allow you italy has counteracted. That's a while then you can a canadian [00:15:00] cannot buy it So, you know, those are the things like, you know, if you're looking to retire in italy and you want the home Now you're going to have to deal with it.

And so this is what I say, yet they have rest of the rules and try to see how it impacts you or get a professional that knows that they will get themselves. They'll get to know you as the client and say, Hey, this is, these are the ones you should be worried about because everything else, in all honesty.

It's tough for you. So there's no answer. It's really let's get to the bottom of it and let's get to like, to me, I like serving my clients and I do, I do what I do well cause I focus on what I do and I'm intelligent enough to not go. Now it's time. We need to talk with Evelyn, right? We need to talk with her or we need to talk with the lawyer and bring her in to sort of get, you want a thing.

That's one thing about the U S. It's very specific and one area, because it's [00:16:00] such a large country that you could specialize in one little code section. Like, I remember at one point, I was in Big Four, I was doing, you know, like 965IH and that, you know. That was it. That was it. And so, and because there's enough volume to just focus that way.

And so you need to make sure that as a client, that you have the right people that will consider all facets of whatever you're, you're dealing with, especially with cross border. Because as we said before, the countries do not. Don't think the same, like for example, with foreign pension, uh, it's, you know, the way the U.

S. rules say, well, you apply these rules as if this was a pension, but, you know, the rules are very complex. Don't think China is going to have the same definition of pension as the U. S. has. So you just have to work and get comfortable, and then, like, a lot of the stuff is, you're going to have to make a decision to [00:17:00] say.

How much of this is going to be important? And guys can say, hey, focus here, not there. Um, I usually like to tell my clients, look, there's an issue there, but let's put it on the parking lot for now. So that we know, and when it becomes a big issue, we can resurface it as needed. I think that's great advice.

Oh my goodness. Such great advice. Um, right now I was thinking you moved to California. Why would you move to the highest tax state? Besides the weather, there are nicer, warm places too. Because California is the fifth largest economy in the world, so you know what, Florida is nice, but it's, the economy is never, like, put it this way, what was a recession here at the time when I came, was boom in the east coast of Canada, you know, in Montreal, so I'm like, oh wow, if you're calling this recession, and then, you know what happened, and, I [00:18:00] practice what I preach.

I'm an international tax accountant. If I cannot lower the tax rate for myself, then who am I good at? So that tax piece of it was not an issue because I go, okay, I know how to play the game. And it helped because, yeah, because I studied U. S. tax in Canada, and I work. At a big four that started up the u. s tax in canada.

So I came with the knowledge It's not that I crossed over and got the knowledge. I came with the knowledge So I already knew how to play the game not so much at the california level, but I already federal level really well down packed I did have mentors. That is so cool. So listen, tell me a little bit about mgo from like What would it be like if one of our clients called you and said, I need you, how do you and your team work with, let's say a small medium business?

How is the little bit of the process so that we can kind of visualize what it's like, obviously not to detail tax, but just how do you bring them on? How do you analyze if [00:19:00] they're a fit for you? What kind of clients are better than others for you? Those types of things. Absolutely. So the first thing that I do is I always have a chit chat, right?

I go, let's meet for about half an hour, 45 minutes and let's have a chit chat because to me it's important to, to, to, uh, like I said, I, I do, I'm good at what I do is because I focus on what I do. So when a client comes in either through referral or they find me somewhere, I basically start asking questions and say, yes, you know what?

Your issues is something that I do. If it's something like, for instance, if it's more immigration related, I say, you know what, why don't you go see Evelyn or someone in her law firm that can help you make her take the lead and she'll call me back. So I sort of have relationships with other professionals, and so to me, I am not doing my job properly if I'm not telling the client.

Hey, this here is who you should ask the lead and here's why so that first conversation is that now let's assume that [00:20:00] they say, you know, I do decide. Yes. You know what? This is the client. That I'm going to take because I could tell you I'm not going to put my license or my name on something that I cannot do 150%.

Um, you know, there's, there's things that, you know, do the best you can do and make sure nobody else behind you can do it better. And I live by that every day. And so if, if, if I can't, I'm not going to set. Myself up or my client up for failure. It's about let's get this right Let's get the right parties because it's not going to be one person I always tell make your accountant and your lawyers your best friends no matter what and so After I decide that I sort of break up the project And usually, I'll start off, especially when it's a consultative type of project, I'll do sort of like a feasibility study.

I said, let me learn more about you, let me get into the details, and I will come up with a structure on how you should conduct your affairs. There's never one [00:21:00] answer. So I go through about 10, 15 structures in my head. I'll based on my experience will narrow it down to the top three Sometimes top four, but I don't like going above that So then notice I bring it to bite size and I explain to my god Here is the three that I chose here is based on the information you gave me Why I believe this one is better suited for you We have that discussion and then we move on it's either you know what?

I've heard enough. I don't want to do this further, but that's the kind that it will say it's not me Or you know what? I like I like number two I like door number two and so I and then I I then I I get into the next phase of the project Okay, here's where you're at How do we get to where we propose and then I outlined how we get there.

So I'm with them all the step of the way and they understand here. We're at a, we're going to get to be, they might not understand how the sausage is being made, but they [00:22:00] understand that there's a process. And I'm working with my staff and my partners very diligently to get them there. You know, as smooth as possible, and it's just it's not just me.

There's, you know, a lot of times this will be an accountant, a lawyer, another tax professional. There's it's you sort of have a team team. Yeah, and then from there. Sorry. I was just going to say from there. After that phase, I become their tax director, right? And so usually with small, medium sized or individuals, they, you know, they're not large enough to have someone like myself full time.

So I go, don't worry about it. Consider me as your fractional tax director. And the whole goal is you grow your business. I will help you with the tax issues. And when I get too busy that I can't service you properly, Then it's time to get a, you know, a tax director on board and I will help them find and so the funny part a lot of clients will ask me, why don't you come in, you know, [00:23:00] they want you, right, it's like, and so it's, it's quite interesting, uh, and sometimes, you know what, I lose a staff, but that's okay, we're all helping each other.

And you know, that's the whole thing. Let's make everybody successful and get to the next level. So it's just a question of getting the right people at the right time, but I sort of handhold them until I know, listen, you're at a point you can, I, you know, I'm still there, but you can, you can run on your own now.

Wow. I love that, John. I, I don't think I've ever heard that before, especially from, you know, a large business like yourself, the idea that you help them, of course, but then it's even, you want them to fly and whether they fly with you or you become more of this maintaining and directing and then finding them replacements.

That, that's crazy. I think it's incredible. So, um, It says, it says a lot about the business you're in and MGO, because we know that the, you know, the big four historically, that's not [00:24:00] ever going to be something that would have happened. They just keep you on and on and on and on. But the idea that you get to the point where if they're already coming to you and they've got all the strategy now, they just need to maintain and then check in every few months, quarterly, once or twice a year to make sure nothing has changed in the tax laws, right, that affect them.

Right, and sometimes it's just a question of I have them structure and then I'll tell my my federal tax partner Take care of them on a daily maintenance area. So it like it might be like i'll refer you internally Or sometimes you need an international tax maintenance person and then we'll just figure out what is best Because their success really is my success, right?

We have to say oh my god, look my clients did this and here's where they got And and so that's really what it's about. It's it's really a human based Business and you know, you want to rejoice in other success that you know, I like to cheer for others. Oh my [00:25:00] God, John. I love this because you bring the Italian hospitality, the passion and the Canadian.

We're so nice. We're so nice. But I also see in you the cutthroat, aggressive, go get it attitude of an American. So you're all inclusive. Yeah. And you know, and you know, to be honest, I'm very fortunate. I'm very, very fortunate because I am who I am because of the experience I've had. And I could tell you my partners were all lawyers.

So and if you look at my like if you look at my resume I actually have a masters of tax, but I went to a law school to get it My partner at the time had to tell that law school and do you take this guy? Just take him and I just got accepted and but they go look we cannot give you a an LLM because you don't have the law.

I go, just give me a master's of tax. And that's a lot, but like I said, I'm the perfect hybrid, if you will, you know, I've got both. [00:26:00] Uh, and so it's just a pleasure after all these years to pull on all the resources I have. To help others, right? And say, Hey, you want to watch this. You want to be careful of that.

And those small things is what your clients appreciate. They go, Oh my God, he's not just doing my taxes. He's telling me watch about this, get yourself. And sometimes I don't have the answer, but I go, Hey, this is what I would ask. The lawyer. Or find out that and then you know what i'll learn through them.

I said, okay look It works for them, but we get to the right answer We eventually get there and as long as you have a network of people willing to help It's a it's amazing what you can do if you give love and passion People say the sky is the limit. I go, no, I go, there's a whole university out there, go beyond the sky.

Go beyond! I love it. I have never had a tax conversation that has been so entertaining. Let [00:27:00] me tell you, John, especially not with my own people. I was like, I know. So I have to thank you so much for this. It's really brought a real lightness to something that sometimes for some people is very heavy. Or very stressful.

And I feel like, you know, you, John Apuzzo with MGO, um, really, really embody that sense of passion and knowledge. And I just want to thank you so much, John, for being on our podcast and sharing your knowledge and wisdom. And for people who want to reach out to you, I know we'll put everything in the notes for the podcast, but why don't you tell us, how can they get ahold of you if they want to talk to you or any of your colleagues?

Absolutely. You can either send me an email at japuzo at mgo. com, uh, or you can just call me on my cell 949 838 5668. Always a pleasure. Always a pleasure to help anybody in need. Oh, thank you so much. I really appreciate you and your [00:28:00] time today. And I really am so glad that you're now in my network too.

So we'll be sending some business your way. And, uh, I want to thank you for your support of our podcast. Absolutely. And likewise, Evelyn, looking forward to having fun and, you know, with our clients and helping everybody succeed.