§ 684 Recognition of gain on certain transfers to certain foreign trusts and estates

OLRC 119-134 · eCFR 2026-10-19 · 5 regs · 2 amending Acts · cited by 1 sections

Enacted 1997 · Pub. L. 105-34 Amended · 2 Acts

199720012010(a) In general(b) Exception(c) Treatment of trusts which become foreign trusts
Connections Cited by 1 · Cites 1
§ 684 Recognition of gain on certain transfers to certain foreign trusts and estates
§ 1.684-1 Recognition of gain on transfers to certain foreign trusts and estates.§ 1.684-2 Transfers.§ 1.684-3 Exceptions to general rule of gain recognition.§ 1.684-4 Outbound migrations of domestic trusts.§ 1.684-5 Effective/applicability dates.
Amended 2001, 2010
  • 2010 Pub. L. 111-312 Pub. L. 111–312 amended catchline, introductory provisions of subsec. (a), and subsec. (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 671.

    “(2) Lifetime transfers to nonresident aliens.—Subsection (a) shall not apply to a lifetime transfer to a nonresident alien.”

  • 2001 Pub. L. 107-16 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 671.”
Final rules 2

    (a) In general 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—

    Cited by 1

      (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.

      (b) Exception 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 671.

      (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.