Most of my readers have heard about Internal Revenue Code Section 965, and the “deemed repatriation” or “transition tax” introduced by the Tax Cuts and Jobs Act (“TCJA”). My earlier blog post provided significant detail about this tax law provision which was intended to move the US international tax regime into a “territorial system”. In making … Continue reading IRS Eye on You! Newest Campaign: Repatriation Tax (IRC Section 965)
Category: Personal Income Tax
Year End Tax Planning: Making Charitable Contributions if You are an American Abroad
Many Americans living and working overseas are involved in charitable causes. The question often arises whether US expats living abroad can obtain the tax benefit for a charitable contribution deduction? The answer depends on various factors, including those discussed below. Where is the Charity Organized or Created? The mere fact that a US taxpayer is … Continue reading Year End Tax Planning: Making Charitable Contributions if You are an American Abroad
IRS Cryptocurrency Update: Taxing Those”Hard Forks” and “Air Drops”
Cryptocurrency (such as Bitcoin) is a type of virtual currency. It is an emerging area, and as such, comes with an enormous amount of uncertainty when it comes to the US tax treatment of transactions involving its use. On October 9, the Internal Revenue Service (IRS) issued Revenue Ruling 2019-24 providing much awaited guidance about … Continue reading IRS Cryptocurrency Update: Taxing Those”Hard Forks” and “Air Drops”
NEWS FLASH! 2019 Tax Returns: Get Ready for Questions About Your Virtual Currency Holdings
It’s no secret, the IRS is very serious with its crackdown on virtual currency. In July, the agency started sending letters to taxpayers who may not have been in compliance with regard to their use of virtual currency. Things are heating up and there’s more to come. The early release draft of the IRS Form … Continue reading NEWS FLASH! 2019 Tax Returns: Get Ready for Questions About Your Virtual Currency Holdings
Is the IRS Trying to Find You?
Moving is always a stressful event and it is easy for certain things to be overlooked. One item on your moving checklist that is critical to remember: properly notifying the Internal Revenue Service (IRS) of your change of address. Today's post tells you how to do it right and the terrible things that can happen … Continue reading Is the IRS Trying to Find You?
“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
Passport Non-Issuance/Revocation: A Welcome Reprieve for Some Tax Debtors
On August 8th, the Internal Revenue Service (IRS) reminded taxpayers with “seriously delinquent tax debt” that they can lose their US passports. I will provide more detail on this below, but first, the “good news”. It was announced on August 14, 2019 that Charles Rettig, the IRS Commissioner, has granted a reprieve for some tax debtors … Continue reading Passport Non-Issuance/Revocation: A Welcome Reprieve for Some Tax Debtors
Did you Join OVDP? You’d Better Still be in Tax Compliance!
The Internal Revenue Service (IRS) has now expanded its compliance campaigns and included “post Offshore Voluntary Disclosure Program compliance” on the list. On July 19th, the IRS through its Large Business and International (LB&I) Division announced six new “compliance campaigns” for taxpayers. Significantly, one of these campaigns targets taxpayers who had entered an Offshore Voluntary Disclosure Program (OVDP) … Continue reading Did you Join OVDP? You’d Better Still be in Tax Compliance!
Virginia - US TAX TALK 