The “Average Annual Net Income Tax” Amounts for “Covered Expatriate Status” – Increases to US$160,000 for the Year 2015

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A previous post explained how the “gain exclusion” amount from the mark to market tax will increase to US$690,000 for the year 2015.  See, The “Phantom” Gain Exclusion from the “Mark to Market” Tax – Increases to US$690,000 for the Year 2015.Average Annual Income Tax Amounts

Today’s post explains that the “average annual net income tax” amount that causes someone to become a “covered expatriate” as set forth in 877 has been indexed for inflation to US$160,000 for the year 2015.  See, IRS Revenue Procedure 2014-16, published this month that references those relatively few code sections which are indexed for inflation.

One of the tests for becoming a “covered expatriate” is the “income tax test” explained with the relevant language of the statute as follows:

(A) the average annual net income tax (as defined in section 38(c)(1)) of such individual for the period of 5 taxable years ending before the date of the loss of United States citizenship is greater than $124,000,


This statutory rule is indexed for inflation and the current amount for 2015 will be US$160,000.

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