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April 8, 2022

Fourth Circuit reverses Tax Court, concluding US-Russia Tax Treaty did not exempt from tax income Russian scientist earned working in US

In Vitaly Nikolaevich Baturin v. Commissioner, the Fourth Circuit has reversed and remanded a Tax Court decision, concluding the lower court misunderstood the basis of the US-Russia Tax Treaty's "distinction between a tax-exempt 'grant, allowance, or other similar payments' and taxable 'salaries, wages, and other similar remuneration.'" The Tax Court had held that payments a Russian scientist received for work in the United States were exempt from tax under the treaty.