Introduction

2019 Inflation Adjustments for Individuals in the International Tax Arena.

Background

This week the IRS published Revenue Procedure 2018-57, setting the inflation adjustments for 2019. For international tax matters, these are some of the key adjustments:

  • $168,000. IRC § 877(a)(2)(A). The average annual net income tax that must be imposed for the five taxable years ending before the date of the loss of United States citizenship (or cessation of long-term permanent residency) for an individual to be considered a “covered expatriate” under IRC § 877A(g)(1). This amount is up from $165,000 in 2018. See Rev. Proc. 2017-58.
  • $725,000. IRC § 877A(a)(3)(a). The amount that can be excluded from the mark-to-market gain upon expatriation of a covered expatriate. This amount is up from $713,000 in 2018. See Rev. Proc. 2017-58.
  • $105,900. IRC § 911(b)(2)(D)(i). Foreign earned income exclusion. This amount is up from $104,100 in 2018. See Rev. Proc. 2017-58.
  • $15,000. IRC § 2503. The amount of the annual gift tax exclusion for gifts to any person. This amount is the same as in 2018. See Rev. Proc. 2017-58.
  • $155,000. IRC § 2523(i). The amount of the annual gift tax exclusion for gifts to non-citizen spouses. This amount is up from $152,000 in 2018. See Rev. Proc. 2017-58.
  • $16,388. IRC § 6039F. Notice of large gifts received from foreign persons. This amount is up from $16,111 in 2018. See Rev. Proc. 2017-58.