By Carrie Schormann
As a general rule, U.S. citizens (no matter where they reside) and non-U.S. citizens legally residing in the U.S. are subject to U.S. gift and estate taxes with respect to all of their assets or interests in assets whether located or situated within or outside of the U.S.
By contrast, non-U.S. citizens domiciled outside the U.S. are subject to gift and estate taxes only on assets or interests in assets located or situated in the U.S. Whether or not an individual is required to pay estate or gift taxes depends on the value of the transfer at the time of the gift or death of the individual, and may be affected by any tax treaty in place with the non-citizen's country of residence.
If a U.S. citizen is married to a non-citizen spouse at his or her death, special arrangements may need to be made to reduce the potential estate taxes payable at death. These special arrangements would require the establishment of a qualified domestic trust (QDOT).
Continue reading the complete article: Estate Planning Issues for Non-U.S. Citizens Legally Residing in the U.S.
Schormann's practice emphasizes estate planning, estate and trust administration and estate and trust litigation. Her experience includes all stages of basic and advanced estate planning, as well as limited partnerships and other types of business entities, “crummey” trusts, intentionally defective grantor trusts, qualified personal residence trusts, insurance trusts, grantor retained annuity trusts, private foundations and charitable trusts. Schormann also assists in the preparation of federal estate tax returns and gift tax returns. She represents corporate fiduciaries in connection with trust and estate administration.