US citizens who get gifts from former Americans now owe a tax

The US Treasury Department has finalized rules for taxing gifts and inheritances from people who gave up their US citizenship or green cards. This means US citizens and residents who receive money or property from these "covered expatriates" will now have to pay a tax on it.

For years, people who renounced US citizenship to avoid taxes could still transfer wealth to US residents without a specific tax on the recipient. These new rules close that loophole. It means that the act of giving up US citizenship to avoid taxes now has a longer tail, affecting the recipients of their wealth.