Expatriation Case

Cases on the new expatriation regime under Code Section 877A are few and far between. The Tax Court has now issued an opinion involving a U.S. resident who gave up his green card and the resulting consequences under Code Section 877A.

The case has two interesting points. The first goes to the issue whether one can be a covered expatriate solely by not filing a Form 8854 that certifies five years of tax compliance at the time of expatriation. Remember that Code Section 877A applies to persons giving up their citizenship or U.S. residency only if they are a “covered expatriate.” This generally means the expatriate has income or assets in excess of statutory thresholds, or does not certify the five years of compliance.

Here, the taxpayer did not file a Form 8854 when he surrendered his green card. Further, the taxpayer in fact had not fully complied with required filings for the preceding five years.

Do these provisions really mean that even…

Gerd Topsnik, 146 TC No. 1 (January 20, 2016)

A boutique law firm with a practice limited to

tax, estate planning, probate, trust & guardianship law and litigation, and related commercial matters