Form 8854: The Expatriation Statement After Renouncing US Citizenship

Form 8854 (Initial and Annual Expatriation Statement) must be filed in the year you relinquish US citizenship or give up a long-term green card, and it is how you certify to the IRS that you have been tax compliant for the five years before you expatriated. If you do not file Form 8854, you are automatically treated as a covered expatriate regardless of your net worth or tax liability, which triggers the full exit tax consequences. Covered expatriates use Form 8854 to report the mark-to-market deemed sale of their assets and calculate the resulting gain and tax. The form is filed with your Form 1040 (or Form 1040-NR if you were a non-resident alien for part of the year) for the year of expatriation, and the deadline is the same as your regular tax return deadline. Some covered expatriates must also file annual Form 8854 in subsequent years to report deferred tax on certain income types that were not immediately taxable at expatriation, such as interests in non-grantor trusts and some deferred compensation arrangements.