Long-Term Resident for Expatriation
Definition of a Long-Term Resident for Expatriation: The concept of a Long-Term Resident is a legal term developed by the U.S. Government. A Long-Term Resident (LTR) is a Legal Permanent Resident (LPR) who has been an LPR or Green Card Holder for at least eight (8) of the last 15 years.
A common question we receive is whether the person has to actually reside in the U.S. to be considered a Long-Term Resident?
The answer is, No.
In order to qualify as a Long-Term Resident, the person is not required to actually live in the U.S.
We will summarize Long-Term Resident & Living in the US residence requirements.
Who is a Long-Term Resident?
The IRS defines a Longe Term Resident as:
“You are an LTR if you were a lawful permanent resident of the United States in at least 8 of the last 15 tax years ending with the year your status as an LTR ends.
In determining if you meet the 8-year requirement, don’t count any year that you were treated as a resident of a foreign country under a tax treaty and didn’t waive treaty benefits applicable to residents of the country.”
What is a Lawful Permanent Resident?
As provided by the IRS:
“You are a lawful permanent resident of the United States if you have been given the privilege, according to U.S. immigration laws, of residing permanently in the United States as an immigrant.”
“Given the Privilege” is Very Important
Becoming an LTR does not require you live in the U.S., rather it requires that you were simply given the privilege to do so.
“You generally have this status if you have been issued an alien registration card, also known as a “green card,” and your green card hasn’t been revoked or judicially or administratively determined to have been abandoned, and you haven’t commenced to be treated as a resident of a foreign country under a tax treaty between the United States and such foreign country.
You aren’t treated as a lawful permanent resident if you commenced to be treated as a resident of a foreign country under a tax treaty, didn’t waive the benefits of such treaty applicable to foreign residents, and notified the IRS of such a position on a Form 8833 attached to a timely filed income tax return.
If you were already an LTR at the time you commence to be treated as a resident of such foreign treaty country, then you will be treated as having expatriated as of that date.“
Form 8833 Tax Trap
Some Taxpayers hastily file a Form 8833, believing it will automatically save them from being treated as a U.S. Person, but oftentimes this is incorrect.
In fact, if the person has already met the time requirements (eight of 15 years) to be considered an LTR, then by filing the 8833, it will be considered the expatriating act.
If the Taxpayer has not properly planned to expatriate, this can have serious tax consequences.
Interested in Expatriation from the U.S.?
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We are the “go-to” firm for other Attorneys, CPAs, Enrolled Agents, Accountants, and Financial Professionals across the globe. Our attorneys have worked with thousands of clients on offshore disclosure matters, including FATCA & FBAR.
Each case is led by a Board-Certified Tax Law Specialist with 20-years experience, and the entire matter (tax and legal) is handled by our team, in-house.
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Less than 1% of Tax Attorneys Nationwide Are Certified Specialists
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Recent Case Highlights
- We represented a client in an 8-figure disclosure that spanned 7 countries.
- We represented a high-net-worth client to facilitate a complex expatriation with offshore disclosure.
- We represented an overseas family with bringing multiple businesses & personal investments into U.S. tax and offshore compliance.
- We took over a case from a small firm that unsuccessfully submitted multiple clients to IRS Offshore Disclosure.
- We successfully completed several recent disclosures for clients with assets ranging from $50,000 – $7,000,000+.
How to Hire Experienced Offshore Counsel?
Generally, experienced attorneys in this field will have the following credentials/experience:
- 20-years experience as a practicing attorney
- Extensive litigation, high-stakes audit and trial experience
- Board Certified Tax Law Specialist credential
- Master’s of Tax Law (LL.M.)
- Dually Licensed as an EA (Enrolled Agent) or CPA
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