Except as provided in regulations, in the case of any transfer of property by a United States person to a foreign estate or trust, for purposes of this subtitle, such transfer shall be treated as a sale or exchange for an amount equal to the fair market value of the property transferred, and the transferor shall recognize as gain the excess of—
(1)the fair market value of the property so transferred, over
(2)the adjusted basis (for purposes of determining gain) of such property in the hands of the transferor.
Subsection (a) shall not apply to a transfer to a trust by a United States person to the extent that any person is treated as the owner of such trust under section
(c) Treatment of trusts which become foreign trusts
If a trust which is not a foreign trust becomes a foreign trust, such trust shall be treated for purposes of this section as having transferred, immediately before becoming a foreign trust, all of its assets to a foreign trust.
2010—Pub. L. 111–312amended catchline, introductory provisions of subsec. (a), andsubsec. (b) to read as if amendment by Pub. L. 107–16, § 542(e)(1)(A)–(C), had never been enacted. See 2001 Amendment note below. Prior to amendment, subsec. (b) read as follows: “Exceptions.—
“(1) Transfers to certain trusts.—Subsection (a) shall not apply to a transfer to a trust by a United States person to the extent that any United States person is treated as the owner of such trust under section
“(2) Lifetime transfers to nonresident aliens.—Subsection (a) shall not apply to a lifetime transfer to a nonresident alien.”
2001—Pub. L. 107–16, § 542(e)(1)(A)–(C), amended section by inserting “and nonresident aliens” after “estates” in section catchline and “or to a nonresident alien” after “or trust” in introductory provisions of subsec. (a) and amending subsec. (b) generally. Prior to amendment, text of subsec. (b) read as follows: “Subsection (a) shall not apply to a transfer to a trust by a United States person to the extent that any person is treated as the owner of such trust under section
Effective Date of 2010 Amendment
Amendment by Pub. L. 111–312applicable to estates of decedents dying, and transfers made after Dec. 31, 2009, except as otherwise provided, see section 301(e) ofPub. L. 111–312, set out as an Effective and Termination Dates of 2010 Amendment note under section
121 of this title.
Effective Date of 2001 Amendment
Amendment by Pub. L. 107–16applicable to transfers after Dec. 31, 2009, see section 542(f)(2) ofPub. L. 107–16, set out as a note under section
121 of this title.
The table below lists the classification updates, since Jan. 3, 2012, for this section. Updates to a broader range of sections may be found at the update page for containing chapter, title, etc.
The most recent Classification Table update that we have noticed was Tuesday, August 13, 2013
An empty table indicates that we see no relevant changes listed in the classification tables. If you suspect that our system may be missing something, please double-check with the Office of the Law Revision Counsel.
Description of Change
Statutes at Large
LII has no control over and does not endorse any external Internet site that contains links to or references LII.