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
In September 2019, the Internal Revenue Service (IRS) announced new Relief Procedures for Certain Former Citizens that will enable certain individuals who relinquished (or are relinquishing) their US citizenship to come into compliance with their US tax and filing obligations. These lucky individuals will not have to pay the back taxes otherwise owed; nor will … Continue reading IRS “Relief Procedures for Certain Former Citizens” – Hey! What About Green Card Holders?
My readers know that broad US tax reform was enacted in December 2017 pursuant to the Tax Cuts and Jobs Act (“TCJA”). As of January 1, 2019, the TCJA’s new tax rules impacted any US spouse who was either paying or receiving alimony under a divorce or separation agreement executed after December 31, 2018. Under … Continue reading Alimony – No Need for Tax Confusion Even if Paying a Nonresident Alien Individual
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?
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)
Transactions now span the globe with the tap of a key on an I-Phone; families are multi-national, with many living in different parts of the world at different stages in their careers and lives; virtual currency has become official legal tender in at least one country, the United States has de facto imposed enforcement of … Continue reading Life Gets Complicated When a Foreign Country’s Laws Impact US Tax
On July 19th, the Internal Revenue Service (IRS) through its Large Business and International (LB&I) Division announced six new “compliance campaigns” for taxpayers. Significantly, one of these campaigns targets “expatriation”, and apparently reaches back to those who “expatriated” on or after June 17, 2008. The campaign will be looking at “expatriates” – US citizens who … Continue reading Have you Expatriated or Thinking of Expatriating? IRS Now Looking Closely
Part I of this blog post examined the importance of the Residency Starting Date (RSD) and how it applied under the Green Card Test. It also pointed out that traps for the unwary can destroy pre-immigration tax planning if one had not correctly nailed down the RSD. Today's post will examine the RSD rules that apply when … Continue reading US Immigrant’s Residency Starting Date – The Devil’s Details – Too Many Days in the USA?
When a foreign individual commences “residency” in the United States for US Income Tax purposes, this date, the Residency Starting Date (RSD), will mark the official date he begins to be taxed on his worldwide income and becomes responsible for various tax information reporting (such as FBAR, Form 5471, Form 8938, to name a few). Commencing on this … Continue reading “Residency Starting Date” – Don’t Leave Home Unless You Understand It!
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