Extension Granted for Gift Tax Returns and Payments – No Extension for Form 3520

My earlier blog post detailed the extensions for filing and payment of US income taxes on account of the COVID-19 emergency.  Further relief was just granted on March 27 by the Internal Revenue Service (IRS) in Notice 2020-20 to all taxpayers who have Federal gift (and generation-skipping transfer) tax returns and payments due on April … Continue reading Extension Granted for Gift Tax Returns and Payments – No Extension for Form 3520

Oh No! I Have a “Foreign” Pension or Employee Savings Plan and Uncle Sam is Killing Me (Part I)

“Foreign” pension or similar plans are a very common feature in the lives of US expats residing and working abroad. As used here, the word “pension” is only a general term. While pensions in the United States often refer to defined benefit retirement plans, my use in today’s blog post refers to a pension as … Continue reading Oh No! I Have a “Foreign” Pension or Employee Savings Plan and Uncle Sam is Killing Me (Part I)

Time to Review! Tax Issues for US Recipients of Gifts/Bequests from Foreigners

With Christmas having recently been on our doorstep, now is the time to review what tax consequences are in store for gift givers and their lucky recipients.  US tax filings might be required of a US individual who receives a gift (whether in cash or property of some kind - you know, a 5 carat … Continue reading Time to Review! Tax Issues for US Recipients of Gifts/Bequests from Foreigners

US Beneficiary of Foreign Trust: Understanding US Tax Filings

I have written a series of blog posts about foreign (i.e., non-US) trusts and the US tax issues associated with them including the US tax filing and reporting requirements for each of the different players in the foreign trust scenario (creator or "grantor"/"settlor" of the trust), the trustee; and today, the US beneficiary. One of … Continue reading US Beneficiary of Foreign Trust: Understanding US Tax Filings

“Purported Gifts” from a Foreign Corporation or Partnership- Exceptions & Application of PFIC Rules

My earlier blog post explained the unpleasant tax effects that occur when a US person receives a "gift" from a foreign corporation or a foreign partnership. Yes, bad things happen.  The general tax treatment for gifts will not apply.  Usually, a gift is not treated as taxable income to the recipient. However, when the gift … Continue reading “Purported Gifts” from a Foreign Corporation or Partnership- Exceptions & Application of PFIC Rules

OOOOPS! I Received a Gift from a Foreign Corporation (or Foreign Partnership)

Here in the Middle East where I have been practicing for almost two decades, I have seen that it is very common for families to create offshore structures in various countries (outside the USA) to hold a large portion of the family wealth.  The underlying reasons for maintaining these structures outside of the family’s home … Continue reading OOOOPS! I Received a Gift from a Foreign Corporation (or Foreign Partnership)

FALSE! Failure to File Form 8854 Means Continued Liability for US Tax on Worldwide Income

For today's post, let me start with the Conclusion! If you expatriate after June 16, 2008 and you fail to file Internal Revenue Service (IRS) Form 8854 (Initial and Annual Expatriation Statement), you DO NOT have continued US income tax liability on your worldwide income.  It's that simple. You may have read or heard otherwise … Continue reading FALSE! Failure to File Form 8854 Means Continued Liability for US Tax on Worldwide Income

US Tax Filings by Fiduciary of Foreign Trust

I have written various blog posts covering foreign (i.e., non-US) trusts. Many of them concern US tax filing and reporting requirements with regard to such trusts.   My initial post provided a general overview of the troublesome US tax issues surrounding foreign trusts, and my blog post here navigates  the tricky waters in determining if a … Continue reading US Tax Filings by Fiduciary of Foreign Trust

US Tax Filings by US Grantor of Foreign Trust

Today's post is a continuation of a series of blog posts dealing with foreign trusts A general overview of the US tax issues surrounding foreign trusts can be found here. When a US person is involved in any way with a foreign trust extra caution is required.  Strict US tax filing responsibilities come into play … Continue reading US Tax Filings by US Grantor of Foreign Trust

Expatriation: Deferring Payment of the Exit Tax

I recently blogged about the debate between Prof. Edward Zelinsky and John Richardson as it pertained to the Exit Tax imposed on so-called "covered expatriates".  This was in the broader context of the US income taxation model which is based on one's "citizenship" rather than one's residence. The thrust of my earlier blog post concerned … Continue reading Expatriation: Deferring Payment of the Exit Tax