September 29, 2022

Tax 101: U.S. Tax Compliance For Dual Citizen Young Adults

September 29, 2022/ Ruchelman P.L.L.C.

It is not uncommon for a young adult who was born in the U.S. to noncitizen parents living temporarily in the U.S. to live abroad. Although he or she may never have returned to the U.S., the young individual is a U.S. citizen, and that status brings with it U.S. tax obligations. In their article, Nina Krauthamer, Wooyoung Lee, and Stanley C. Ruchelman address the tax obligations in the context of Ms. A, a typical young adult, born in the U.S., but living abroad. She may have a bank account in a foreign county, but ordinarily will not have her own source of income. At some point, Ms. A may receive gifts and bequests from her foreign parents or grandparents. At this point in her life, Ms. A’s U.S. tax compliance obligations become complex. Just how complex is explained by the authors.

November 20, 2019

I.R.S. Releases Relief Procedures for Certain Expats While Warning Bells Ring for Others

November 20, 2019/ Ruchelman P.L.L.C.

The I.R.S. recently announced new procedures that will enable certain individuals who have or will relinquish their citizenship after March 18, 2010, to come into compliance with related U.S. tax and filing obligations. As a first step, U.S. citizenship must be relinquished. Once that is completed, specified identification documents, a complete dual-status tax return for the year of expatriation, and tax returns for the five tax years preceding the expatriation must be submitted. Comparable provisions will apply for long-term residents who relinquish that status. Galia Antebi and Hannah Daniels, an extern at Ruchelman P.L.L.C. and student at New York Law School, explain.

November 30, 2017

Anti-Inversion Rules Are Not Just for Mega-Mergers – Private Client Advisors Take Note

November 30, 2017/ Web Admin

The U.S. has rules that attack inversion transactions, wherein U.S.-based multinationals effectively move tax residence to low-tax jurisdictions. If successful, these moves allow for tax-free repatriation of offshore profits to the inverted parent company based outside the U.S. However, the scope of the anti-inversion rules is broad and can also affect non-citizen, nonresident individuals who directly own shares of private U.S. corporations. Attempts to place those shares under a foreign holding company as an estate planning tool may find that the exercise is all for naught once the anti-inversion rules are applied. Elizabeth V. Zanet, Galia Antebi, and Stanley C. Ruchelman discuss the hidden reach of the anti-inversion rules to private structures.