Saturday, December 13, 2014

This Just In! Final Regulations On Reporting of Foreign Specified Assets On Form 8938!

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If you remember from my blog post here, Form 8938, is the Statement of Specified Foreign Financial Assets. This form is required to be filed to remain in compliance with IRC § 6308D. You may not have known that the Internal Revenue Service hadn't yet made the 2011 rules & regulations under this code final, comments & concerns were still being gathered. 

The Internal Revenue Service on December 11th, 2014 has issued final regs that provide guidance on the requirement under Code § 6038D, for Form 8938 filers. This provides more information and clarifications on certain filers, types of assets to be reported, valuation etc.

The final regs apply for tax years ending after Dec. 19, 2011, but taxpayers may apply them to earlier years.

To quickly recap, the Form 8938, has to filed by individuals with an interest in a "specified foreign financial asset" during the tax year in which the aggregate value of all such assets at the end of the year is $50,000 for Single filers and $100,000 for filers with the status Married Filing Jointly. IRC § 6308D also applies to a domestic entity that has been formed or used for purposes of holding specified foreign financial assets in the same way as if it were an individual. 

If the Form 8938 is not filed as required during a tax year, there is a penalty of $10,000. This penalty increases if the taxpayer continues to stay non-compliant.

Specified Foreign Financial Assets are:

(1) Depository or custodial accounts at foreign financial institutions, 
(2) To the extent not held in an account at a financial institution, 
       (a) Stocks or securities issued by foreign persons, 
       (b) Any other financial instrument or contract held for investment that is issued by 
            or has a counter-party that is not a U.S. person, and 
       (c) Any interest in a foreign entity. 

  Final regs. 
In late December of 2011, IRS issued temporary and proposed regs detailing the Code Sec. 6038D requirement for individuals to attach a statement to their income tax return to provide information on foreign financial assets in which they had an interest At that time, IRS also released the final version of Form 8938 (Statement of Specified Foreign Financial Assets) and its Instructions.

IRS has adopted the 2011 temporary regs as final regs with certain modifications described below. 

Dual resident taxpayers: 
The final regs provide an exemption from the Code Sec. 6038D reporting requirements for a dual resident taxpayer who determines his U.S. tax liability as if he were a nonresident alien and claims a treaty benefit as a U.S. nonresident by 
  • Timely filing a Form 1040NR, Nonresident Alien Income Tax Return (or such other appropriate form under that section), and 
  • Attaching a Form 8833, Treaty-Based Return Position Disclosure. 

Persons not required to file tax return:
As provided in the 2011 temporary regs, the final regs provide that a specified person that doesn't have to file a tax return for the year doesn't have to file a Form 8938.

Non-vested property: 
The final regs clarify that a specified person that is transferred property in connection with the performance of personal services is first considered to have an interest in the property for purposes of Code Sec. 6038D on the first date that the property is substantially vested or, in the case of property with respect to which a specified person makes a valid election under Code Sec. 83(b), on the date of transfer of the property. 

Assets held by a disregarded entity (most times an LLC):
The final regs provide that a specified person that owns a foreign or domestic entity that is a disregarded entity, is treated as having an interest in any specified foreign financial assets held by the disregarded entity. 
As a result, a specified person that owns a disregarded entity (whether domestic or foreign) that, in turn, owns specified foreign financial assets, must include the value of those assets in determining whether the specified person meets the reporting thresholds under IRC § 6308D and, if so, must report the assets on Form 8938. 






Jointly owned assets for those who are not married to each other:
The final regs clarify that each of the joint owners of a specified foreign financial asset who are not married to each other must include the full value of the asset (rather than only the value of the specified person's interest in the asset) in determining whether the aggregate value of the specified individual's specified foreign financial assets exceeds the applicable reporting thresholds, and each joint owner must report the full value of the asset on his or her Form 8938. 


Jointly owned assets for those who are married to each other, but file separately:
The final regs also clarify that, in the case of joint owners who are married to each other and file separate returns, each joint owner of a specified foreign financial asset must report the full value of the asset (rather than only the value of the specified person's interest in the asset) on the individual's Form 8938, even if both spouses are specified individuals and only one-half of the value of the asset is considered in determining the applicable reporting thresholds under IRC§ 6038D. 


Specified foreign financial assets: 
The final regs modify the definition of a financial account for purposes of Code Sec. 6038D in order to require consistent reporting under Code Sec. 6038D with respect to:  

  • Retirement and pension accounts and certain non-retirement savings accounts:      For tax years beginning after Dec. 12, 2014, the final regs also provide that retirement and pension accounts, non-retirement savings accounts, and accounts satisfying conditions similar to those described in Reg. § 1.1471-5(b)(2)(i) and that are excluded from the definition of a financial account under an applicable Model 1 IGA or Model 2 IGA (as provided in Reg. § 1.1471-5(b)(2)(vi)), are included in the definition of a financial account for Code Sec. 6038D purposes. 
  • Stock, securities, financial instruments, and contracts that are held for investment: The final rule clarifies that specified foreign financial assets include stock, securities, financial instruments, and contracts that are held for investment and not held in an account maintained by a financial institution and are issued by a person organized under the laws of a U.S. possession. 

Valuation:
The final regs clarify that the maximum fair market value for a specified foreign financial asset with no positive value during the year is treated as zero. 


Foreign currency:
The final regs adopt two modifications to the valuation rules relating to foreign currency:  
  • First, the final regs state that a foreign currency conversion shown on a periodic financial account statement is among the aspects of the statement that a taxpayer may rely upon to the extent provided in Reg. § 1.6038D-5(d).
  • Second, IRC § 6038D of the 2011 temporary regs provides that, except as otherwise provided, a specified person must use the foreign currency exchange rate issued by the U.S. Treasury Department's Financial Management Service for purposes of Code Sec. 6038D. The final regs are updated to reflect the fact that foreign currency exchange rates are now issued by the Treasury Department's Bureau of the Fiscal Service. 
Please consult with a tax professional for advice on Form 8938,it's thresholds and compliance requirements if the rules under IRC Section 6308D apply to you. 


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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com



Wednesday, December 3, 2014

Learning The Mechanics Of A Foreign Tax Credit!

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Income tax systems that tax residents on worldwide income (such as the American tax system) generally offer a foreign tax credit to relieve a potential for double taxation. This credit is usually limited to the income attributable to foreign source income. 

What does this mean? If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes. 

This means that, if taken as a deduction, foreign income taxes reduce your U.S. taxable income. Or if taken as a credit, foreign income taxes reduce your U.S. tax liability. One can choose whether to take the amount of any qualified foreign taxes paid or accrued during the year-- as a foreign tax credit or as an itemized deduction. Also, one can change one's choice for each year's taxes. However, this choice applies to all foreign taxes paid or accrued during the year. 

For the purposes of this blog post, we will focus on the foreign tax credit. The foreign tax credit is taken on the Form 1116, Foreign Tax Credit. 

One can claim a foreign tax credit:
  • Only for foreign taxes on income, war profits, or excess profits, 
  • Or for taxes in lieu of these taxes. 
  • In addition, there is a limit on the amount of the credit that you can claim. You figure this limit and your credit on Form 1116. 
  • Your credit is the amount of foreign tax you paid or accrued or, if smaller, the limit.

Exemption from the foreign tax credit limit: This limit will not apply to you and you will be able to claim the foreign tax credit without the Form 1116 if the following requirements are met: 
  •  Your only foreign source gross income for the tax year is passive category income. (Passive Income is that from dividends, interest, rents, royalties, annuities and some net gains)
  •  Your qualified foreign taxes for the tax year are not more than $300 ($600 if married filing a joint return).
  •  All of your gross foreign income and the foreign taxes are reported to you on a payee statement (such as a Form 1099-DIV or 1099-INT).
  •  You elect this procedure for the tax year. If you make this election, you cannot carry back or carry over any unused foreign tax to or from this tax year.


Foreign Taxes From A Partnership or S Corp: If foreign taxes were paid or accrued on your behalf by a partnership or an S Corporation, the foreign tax credit can be figured from some information from the Schedule K-1. 

Foreign Income Exclusion:  We talked about the ability to exclude your foreign income from taxation in this post. If you opted to exclude your foreign income, you cannot claim foreign tax credit on the same income. 

Tax Treaties:  The United States has tax treaties with various countries, in part to prevent double taxation of the same income by the United States and the treaty country. Certain treaties have special rules you must consider when figuring your foreign tax credit if you are a US citizen residing in that treaty country. 

Carryback and Carryover: If, because of the limit on the credit, you cannot use the full amount of qualified foreign taxes paid or accrued in the tax year, you are allowed a 1-year carryback and then a 10-year carryover of the unused foreign taxes.

Note: Do not forget that having passive foreign income maybe indicative of foreign bank accounts. In which case you have a responsibility to file FinCEN Form 114 and/ or Form 8938. More about these forms in my post here

These numbers are tricky and you may not be able to get the different and best options available to you even with an over-the-counter software in a box. Make sure you consult with an Enrolled Agent about the best option for you. 

Bibliography: Publication 514; Form 1116, Foreign Tax Credit; Form 2555; FinCEN Form 114; Form 8938

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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com




Sunday, November 23, 2014

What If I Own Real Estate In a Foreign Country? Answers Here!

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There's this question that I always get from my clients: "Do I have to report my real estate holdings in a foreign country?" To which, my answer (in true accountant style) is always: "It depends". Let me explain further. 

You may be a first generation immigrant to the US and still have strong ties to your home country; by way of family elders who live there or a strong sense that you would like to some day retire back there, where you grew up. Or you are an adventurous investor who would like to invest in a little vacation home by the beach in the Caribbean. Or you were stationed abroad through your job and loved it so much that you invested in some property there. Then this blog is for you to read! 

The FATCA makes it mandatory for U.S. citizens, Green Card holders and foreign individuals with substantial presence in the US, to disclose all of their offshore holdings on their tax returns (via Form 8938), or on the FBAR, now known as Form FinCEN 114. Due to Inter-Governmental Agreements (aka IGA s), foreign financial institutions also disclose this information to the U.S. government. 



Bengaluru, Karnataka, India
Form 8938, Statement of Specified Foreign Assets, applies to foreign financial accounts, including stock in foreign companies and stakes in foreign business partnerships. So, what about your real estate holdings in foreign countries, do they have to go on these forms? 

If your foreign real estate holdings were held directly by you, then it is NOT a specified asset that needs to be reported on Form 8938, for example, your personal residence or a rental property.

Please do not stop here! Read On! 

A. If these real estate holdings were held by a foreign entity, such as a foreign corporation, partnership, estate or a trust, in which you have an interest, then ONLY the investment in this foreign entity must be reported on Form 8938, if the form thresholds are met. 

The value of this interest would be determined by the fair market value of the real estate holdings.

If point # A applied to you, there are other reporting requirements in addition to Form 8938. 

B. If the foreign property is in your name and is rented out, the rental income is to be reported on Schedule E of Form 1040.  The allowable expenses are the same as if the rental property was in the US, however, the depreciation is taken straight-line over a period of 40 years instead of 27.5 years. 

C. If the foreign property was inherited, if the inherited property was transferred to your personal name then it not a specified asset to be reported on Form 8938 unless the inheritance was an interest in a corporation, partnership or trust that held real estate. 



D.If the foreign property in your personal name were to be sold,   you will have to report short term or long term capital gains, as the case may be, via Schedule D to Form 1040 in the year the sale occurred. You may be eligible to get a foreign tax credit against your US taxes, if taxes were paid on the sale in the foreign country where the property was located. 

E.  If the foreign property was your personal residence, that is if you lived in the foreign property, 2 out of previous 5 years, immediately prior to the sale, you may be eligible for an exclusion on the sale- of $250,000 if filing as single or $500,000 if filing married & joint.

Agreed that owning property in a foreign country is not a walk in the park, but understanding the rules and regulations will keep you in compliance, and will make it manageable. Please make sure you completely understand your compliance requirements if any of the above apply to you. Better yet, consult an Enrolled Agent! 

Bibliography: Form 8938, Statement of Specified Foreign Financial Assets; Form 1040 & Schedules D & E; Internal Revenue Code § 121; Publication 946. 


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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com


Sunday, November 16, 2014

"MyRa"...A New Retirement Buzz Word Or a Dud?

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President Obama signed a presidential memorandum in January of 2014 directing the Dept of Treasury to create "myRA". The memorandum states myRA to be a "a new simple, safe and affordable “starter” retirement savings account that will be initially offered through employers and will ultimately help low and moderate income Americans save for retirement". 

The proposal is that beginning in late 2014, with this retirement savings account  individuals will be able to open accounts and begin contributing to them every payday. myRAs will be initially offered through employers, balances will never go down, and there will be no fees. myRAs will hold a new retirement savings bond that will be backed by the U.S. Treasury.


The key features of myRA include: 

  • No cost to open an account.
  • Contribute to savings through regular payroll direct deposit.
  • Individual decides how much to contribute every payday ($50, $25, $7 – any amount!)
  • No fees.
  • myRAs will earn interest at the same variable rate as the Government Securities Investment Fund in the Thrift Savings Plan for federal employees.
  • myRAs will not be limited to one employer  – the account will be portable.
  • myRA contributions can be withdrawn tax free.
  • Earnings can be withdrawn tax free after five years and the saver is 59½.
  • Account holders can build savings for 30 years or until their myRA reaches $15,000 – whichever comes first. After that, myRA balances will transfer to private-sector Roth IRAs.





What Do People Think about myRA? 

According to the writers over at CNNMoney, there are people on both sides of the fence on this topic, there are those who do not want to "give a broke and bankrupt government any more money". And there are those who keep their modest savings in accounts yielding less than 1% returns, to them a 2% guaranteed return while saving for retirement is worth considering. 

 We can see that one can start small with this retirement account and that this might be a great tool for low, middle-income or part time employees to get started on the path to retirement. 

So how does myRA transition to the next step?  The total contribution to the myRA caps at $15,000. Once this happens, the balance is transferred to a Roth IRA. The balance however continues to grow tax-deferred till it is withdrawn just like any other IRA account. 

Retirement experts say that people who run their retirement calculations regularly tend to save more intelligently. And those who have a payroll deduction towards retirement are more likely to keep up with it. 

John F. Wasik, the author of "Keynes' Way to Wealth: Timeless Investment Lessons from the Great Economist, says in his article on forbes.com, that retirement security is sagging and economic inequality is partially perpetuated by this country’s fractured retirement security policy. 

Although myRA offers a good opportunity to help people save for retirement without putting a lot of pressure on the current employer-based system and more mandates on small businesses, it remains to be seen how many sign up for this and can make a meaningful dent in the retirement-savings shortfall. 

Bibliography: www.myra.treasury.gov; Keynes' Way to Wealth: Timeless Investment Lessons from the Great Economist; Center for American Progress; www.irs.gov


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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com.

Friday, November 7, 2014

You Have Foreign Bank Accounts? Questions Your Tax Preparer Should Be Asking!

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My expression was like that of the puppy in the picture when a client of ours revealed their foreign bank account balances a month after we had filed their tax returns. A long lecture about foreign account balances, and an Amended Tax Return followed with required attachments.  We quickly realized the need for the right questions in the December Tax Organizer. This was a few years ago and there have been many updates to those questions now.

Unfortunately there are many taxpayers out there who are still unaware of their filing/ reporting requirements. More details on the requirements in my post here. And many a time this is because they have not been educated of their requirements by their tax preparers. 

Due Diligence is a BIG buzz word in tax professional circles! Especially since many taxpayers unaware of their requirement to file FBARs, blame the tax preparer on whom they reasonably relied. The tax practitioner in turn relies in good faith on the information provided to them by their clients, and are not required to audit the records of the client. 

Circular 230, § 10.22 lays out the level of due diligence required to be exercised by Practitioners (Attorneys, CPA s, Enrolled Agents or Enrolled Actuaries): 
  • (a) In preparing or assisting in the preparation of, approving, and filing returns, documents, affidavits, and other papers relating to Internal Revenue Service matters; 
  • (b) In determining the correctness of oral or written representations made by him to the Department of the Treasury; and 
  • (c) In determining the correctness of oral or written representations made by him to clients with reference to any matter administered by the Internal Revenue Service. 
In addition to the above, a tax practitioner is also required by Circular 230, § 10.34 to not ignore the implications of any information provided. The tax professional should also advise the taxpayer of any potential penalties of non-compliance. 

If the tax practitioner determines that there is a foreign bank account to report on Schedule B, he is not obligated to prepare the FBAR form for the client. He can do so only if he feels competent and the client has agreed to this additional service. 

Notwithstanding the above lack of obligation to prepare the FBAR, the practitioner does have an obligation to advise the client of the need to file the FBAR form and the consequences of failing to do so. 



So What Questions Should Your Tax Preparer Be Asking You About Your Foreign Accounts?: 
  1. Do you own accounts in countries other than the United States? Do you have a signatory authority over them either in your name or as a joint/ secondary holder?
  2. What are the nature of the bank accounts and how much are the balances therein. 
  3. Have you reported these accounts every year? 
  4. Did you have income from these accounts? If yes, has the income been included on the tax return? 
  5. How have you answered the question on Schedule B of Form 1040, Part III, Line 7a? 
  6. If thresholds were met, was FinCEN Form 114, Report of Foreign Bank & Financial Accounts aka FBAR filed? (FinCEN Form 114 was known as TD F 90-22.1)
  7. If thresholds were met, was Form 8938, Statement of Specified Foreign Financial Assets, filed with the tax return? 
  8. Are you a beneficiary of a foreign trust? If so what is the nature of the relationship? Have you received a distribution? 
  9. Do you own stock in foreign companies or partnerships? If so what percentage of the total is it?
  10. Are you a participant in a foreign retirement plan? 
  11. Do you have mutual funds, insurance policies in foreign countries? 
With a heightened availability of information to the Internal Revenue Service about foreign bank accounts through many Inter-Government Agreements, tax payers who have accounts in foreign banks or other such instruments should make sure their tax practitioners are asking the above questions. 






Know Your Responsibility:  If you are one of those reading this blog and have undisclosed foreign bank accounts, I cannot assert enough how important it is for you to come forward voluntarily with disclosure. The Internal Revenue Service's 2014 Offshore Voluntary Disclosure Program (OVDP) is still open. If the IRS contacts you about these accounts then you will be subject to heavy fines & penalties and you will no longer have the chance to file under the OVDP. 

Bibliography: Circular 230; FinCEN From 114; Form 8938; FBAR FAQs from www.irs.gov

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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com




Sunday, October 5, 2014

Oh My! You Have Substantial Presence in the US? Now You Have To File Taxes!

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I usually have clients who need substantial presence in the USA. Most times this is for a spouse and/ or a dependent in the country to apply for an ITIN  when they would not otherwise qualify for a Social Security Number. It is also possible that the taxpayer himself needs to establish substantial presence in the US so he is able to make a "First Year Choice" for the previous year. 

Some taxpayers whose parents make repeated trips from abroad and stay with the taxpayers for extended periods of time, may be able to apply for ITINs if they fulfill the substantial presence requirements. This usually results in the taxpayers claiming the parents as dependents for that year if other dependency tests are fulfilled. 

There are caveats on new ITINs issued, please read my post here for more information on this. 

There is a flip side to this issue however, before we explore that we need to know what "Substantial Presence" is and how the Substantial Presence Test (SPT) or the "Green Card Test (GCT) is calculated: 

You will be considered a U.S. resident for tax purposes if you meet the substantial presence test for the calendar year. 



To meet the SPT, you must be physically present in the United States on at least:
  1. 31 days during the current year, and
  2. 183 days during the 3-year period that includes the current year and the 2 years immediately before that, counting:
  • All the days you were present in the current year, and
  • 1/3 of the days you were present in the first year before the current year, and
  • 1/6 of the days you were present in the second year before the current year.
Rule 1: You are treated as present in the United States on any day you are physically present in the country, at any time during the day.

Rule 2: One does not have to count days for which one was an exempt individual

Rule 3: Closer Connection to a foreign country. 

There are exceptions to above 3 rules and are detailed in Pub 519, U.S. Tax Guide for Aliens. 

To meet the GCT, you are a resident, for U.S. federal tax purposes, if you are a Lawful Permanent Resident of the United States at any time during the calendar year. 

And you are a Lawful Permanent Resident of the United States, at any time, if you have been given the privilege, according to the immigration laws, of residing permanently in the United States as an immigrant. You generally have this status if the U.S. Citizenship and Immigration Services (USCIS) issued you a Form I-551, also known as a "green card."

If you meet the green card test at anytime during the calendar year, but DO NOT meet the substantial presence test for that year, your residency starting date is the first day on which you are present in the United States as a Lawful Permanent Resident (Green Card Holder).
 



The flip side of this issue as it recently happened to a client, once a non-US person is classified as a "resident" for income tax purposes, he is subject to income tax in the same manner as a US citizen. He is taxed on his world wide income, that includes income from within AND outside the US. 

The world wide income covers what is earned from the start of the residency period to the end. This income includes wages, interest, dividend, rents & royalties, capital gains no matter where they were sourced from. 

The person also becomes responsible for filing tax returns including FBAR forms. More on requirements to file FBAR on my post here. There are also other tax obligations if this person is a shareholder in a corporation outside the country or gets a distribution from a foreign trust. 


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Consult with a tax professional for your unique needs and make sure your questions are answered. Always remember to read my disclaimer here. If you have any more questions regarding this or other tax matters, contact me at manasa@mntaxsolutionsllc.com. 

 
 





Friday, September 26, 2014

Expatriation: Divorcing the Government Has Tax Consequences

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As someone who moved around a lot with my parents in my childhood, any kind of displacement conjures up vivid images of huge wooden crates, packers & sad goodbyes. But life is no longer as simple as crates, packers & going-away gifts, many US citizens who had relocated and moved abroad are deciding to renounce their US citizenship. 2013 was a record-breaking year that saw an alarming increase (221%-according to the Treasury Department of US) of Americans renouncing their citizenship . Why such a drastic move? A big reason is the global tax reporting requirement and FATCA. 

I read this somewhere, that "expatriation is like divorcing a government". As heart-wrenching and final as that may sound, it is made even more complex by the tax provisions under Internal Revenue Code (IRC) sections 877 and 877A. So if you decide on taking such a step, what would be the tax consequences? 

These rules apply to US citizens who have renounced their citizenship and long-term residents (defined in IRC 877(e)) who have ended their US resident status for federal tax purposes. The rules differ based on the date of expatriation. For the sake of today's blog post, we will discuss the latest date which is June 16,2008. 



Expatriation on or after June 16,2008: The new IRC 877A rules apply to you if ANY of the following statements apply, 
  • Your average annual net income tax for the last 5 years ending before the date of expatriation or termination of residency is $157,000 or more for 2014.
  • Your net worth is $2 million or more on the date of your expatriation or termination of residency.
  • You fail to certify on Form 8854 that you have complied with all U.S. federal tax obligations for the last 5 years.
If any of the above rules apply to you, you are a "covered expatriate". And you have to pay exit tax. 


The exit tax is like a capital gains tax because all the property of the covered expatriate is deemed sold for its fair market value on the day before the expatriation date. 

There is an exclusion amount for the exit tax, for 2014, it is $680,000. 




A US Citizen can relinquish his/ her citizenship on the earliest of FOUR possible dates: 
  1. When he/ she appears before a diplomatic/ consular officer.
  2. The date on which she/ he sends a statement of voluntary relinquishment to the US Department of State. 
  3. The date the US Department of State issues a certificate of loss of nationality. 
  4. The date a US court cancels a certificate of naturalization. 
Note. If you expatriated before June 17, 2008, the expatriation rules in effect at that time continue to apply. See chapter 4 in Publication 519, U.S. Tax Guide for Aliens, for more information.

The fee for renunciation of US citizenship is $2,350. 

The important take away points from this blog post are that, in order to avoid tax consequences of renouncing your US citizenship, you have to prove you have been regular in filing your tax returns for the past 5 years AND if you are worth more than $2 million or you have been paying income tax of $157,000 or more (for 2014), you have to pay an exit tax on renunciation. 

The decision to expatriate is not to be taken lightly. Always consult the right professional who can guide you with respect to your unique circumstances. 

Bibliography: Pub 519; irs.gov; Internal Revenue Codes 877 & 877A; Department of Treasury

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As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. 
More of my contact information is on my website, www.mntaxsolutionsllc.com