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Learning To Live With The New Foreign Nongrantor Trust Rules, Carlyn S. Mccaffrey, Elyse G. Kirschner
Learning To Live With The New Foreign Nongrantor Trust Rules, Carlyn S. Mccaffrey, Elyse G. Kirschner
Vanderbilt Journal of Transnational Law
The Small Business Job Protection Act of 1996 (the 1996 Act) was intended to deal a heavy blow to the appeal of foreign trusts to U.S. persons. The results were mixed. On the one hand, the 1996 Act imposes an array of reporting requirements, imposes harsh penalties on failures to comply with these requirements, increases the interest charge imposed on taxes paid on distributions of accumulated income from foreign trusts, treats loans of cash from foreign trusts as distributions, and expands the kinds of gifts that can be treated as indirect transfers from foreign trusts. On the other hand, curiously, …