Representatives of the governments of the United States and Hungary on February 4, 2010, signed a new income tax treaty.1 The new treaty, which was signed in Budapest, is intended to replace the existing income tax treaty that has been in place since 1979. The new treaty will have to be approved by the U.S. Senate, and in Hungary, before instruments of ratification can be exchanged and the treaty will enter into force. A transition rule allows a person entitled to benefits under the 1979 treaty to elect to have that treaty apply, in its entirety, through December 31, 2010.