Paul L. Caron

Wednesday, May 28, 2008

WSJ: New Law Makes Escape Tougher For Tax Exiles

[summary box]Article in today's Wall Street Journal:  New Law Makes Escape Tougher For Tax Exiles, by Martin A. Vaughan:

It's been called "the ultimate estate plan": moving to a desert island or other far-off locale to escape the clutches of the IRS. Indeed, hundreds of Americans do formally renounce their U.S. citizenship every year, many in order to protect their wealth from income, estate and gift taxes. But last week, Congress may have made life less rewarding for tax exiles. ...

Now, after years of threatening to do so, Congress has passed a law that will tax the assets of those who leave for good on their way out the door, as if they were selling those assets. But tax experts say the more significant change may be a provision that taxes U.S. heirs on amounts given or left to them by ex-U.S. citizens. Taxing the recipient instead of the donor will make it harder to get around the tax rules.

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Today's WSJ New Law Makes Escape Tougher For Tax Exiles By MARTIN A. VAUGHAN The new taxes are included in legislation providing tax benefits for soldiers and military veterans and will apply only to those who renounce their citizenship after [Read More]

Tracked on May 28, 2008 7:26:20 PM