Comments to Proposed Regulations (IRS-REG-112997-10) Guidance under Section 2801 Regarding the Imposition of Tax on Certain Gifts and Bequests from Covered Expatriates

SUMMARY 

The Estate and Gift Taxation Committee (Paul Ferrara, Chair) sent a letter to the Internal Revenue Service that provides comments on the IRS’s proposed regulation offering guidance under Section 2801 regarding the imposition of tax on certain gifts and bequests from “covered expatriates.” The Committee’s comments centered on the following areas: (1) determination of how contributions to or distributions from a non-electing foreign trust to a U.S. citizen spouse could qualify for the marital exception in Section 2801(e)(3); (2) determination of when a transfer qualifies for the exception for transfers subject to gift or estate tax; (3) determination of whether and how a recipient of a gift or bequest is able to determine responsibility for complying with Section 2801; and (4) determination for when a transfer qualifies for the annual exclusion.

RULE INFORMATION

IRS-REG-112997-10, Imposition of Tax on Certain Gifts and Bequests from Covered Expatriates