The US Internal Revenue Services (IRS) has issued guidance on the new exit tax that applies to individuals subject to US expatriation on or after 17 June 2008.
Expatriation is a term used to refer to individuals who have given up their US citizenship and long term residents who cease to be a permanent resident of the US. There are two parts to expatriation:
- firstly, there are the legal aspects of giving up citizenship; and
- secondly, the individual will need to file the required forms with the IRS which satisfy its requirements.
It is expected that future regulations incorporating this new guidance will apply to individuals expatriating on or after 15 October 2009. Until these regulations are issued, such individuals may rely on this IRS guidance. In addition, individuals whose expatriation date is on or after 17 June 2008, and before 15 October 2009, may also rely on the new guidance.
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