InterActive Legal

Please join us for the next installment in the InterActive Legal Speaker Series on a topic that may be foreign to some of us – expatriation. Clients are becoming more interested in this topic, and this presentation will focus on the tax implications in detail.

In this webinar, attorney Sebastian Orozco will provide a detailed examination of U.S. tax issues affecting individuals who expatriate under the framework of Section 877A of the Internal Revenue Code and the newly finalized Section 2801 regulations.  He’ll outline the definitions and criteria for classification as a covered expatriate, and the resulting tax consequences, including the mark-to-market exit tax regime, the treatment of pre-expatriation gifting, and beneficial interests in trusts.  

We’ll learn about compliance requirements, such as dual-status tax returns and Form 8854—including some of the penalties for non-compliance. Special attention will be given to the treatment of deferred compensation, nongrantor trusts, and tax-deferred accounts, offering practical guidance for navigating the final year of U.S. tax residency.

The materials also will explore strategic planning opportunities for long-term residents who are considering expatriation, including treaty-based residency elections and pre-expatriation gifting strategies. The implications of the Section 2801 tax on covered gifts and bequests will be covered, detailing how the tax is calculated, reported, and enforced. Examples will illustrate the tax treatment of distributions from domestic and foreign nongrantor trusts, and the complexities that surround them.