Proposed regulations: Nonresident aliens, potential current beneficiaries of electing small business trusts

February 26, 2019

The U.S. Treasury Department and IRS today released for publication in the Federal Register proposed regulations (REG-117062-18) as guidance under measures enacted in December 2017 that expand the class of permissible potential current beneficiaries of an electing small business trust (ESBT) to include nonresident aliens. The proposed regulations [PDF 248 KB] are intended to provide that the income of an S corporation will continue to be subject to U.S. federal income tax when a nonresident alien is a deemed owner of a grantor trust that elects to be an ESBT.

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