Complex estate and gift tax rules apply to your estate planning if you are not a U.S. citizen and you own assets in the United States.
The rules vary depending on whether you are a non-resident alien (NRA) – someone who is present in the United States on a temporary basis, such as a visitor, a student, or a on work permit (for example, an H-1 or a B-1 visa), or a resident alien (a "green card" holder).
These rules become even more complex if you die owning "U.S. situs" assets. Without getting overly technical, U.S. situs assets include stock options in a U.S. company, stock ownership in a U.S. company, a U.S. company's corporate bonds, and real estate located in the U.S. Other items are included, too, but these are the most common.
For example, many people think land in Silicon Valley is very cheap right now. They are flocking to Los Altos, Palo Alto, Atherton, and other San Francisco Bay Area communities to purchase houses and condominiums.
These real estate investors may be quite right ... some of the real estate in the Bay Area is at its lowest price in years.
But they are overlooking an important consideration: if they are not U.S. residents and something were to happen to them, they are only entitled to a $60,000 exemption from U.S. gift and estate taxes – non-resident aliens (NRAs) pay a much higher rate of gift and estate taxes than U.S. citizens.
And even if the non-US citizens have their "green cards", they may still be subject to the extremely high gift and estate tax rate that non-resident aliens pay – a person can be a US resident for income tax purposes but a "non-domiciliary" for gift and estate tax purposes. While US income taxes are based on "residency", US gift and estate taxes are based on “domicile”, which is a very different concept.
There are ways in which a “non-domiciliary” can legally avoid having to pay high gift and estate tax rates. However, not many estate planning lawyers are aware of the planning opportunities for non-US citizens and non-residents.
It's crucial that you work with an attorney who is familiar with the effects of U.S. estate and gift tax law on you and your family - and who also knows how to deal with the fact that your country of birth may tax you, too.
Call today to find out how the Law Office of Janet Brewer can help you plan your estate so that your family does not pay hundreds of thousands of dollars in estate taxes that could have been avoided by knowledgable international estate tax planning.
Please call (650) 325-8276 today to let us know your needs.
Copyright © Law Office of Janet L. Brewer. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement. Some artwork provided under license agreement.
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Law Office of Janet Brewer
2501 Park Boulevard, Suite 100
Palo Alto, CA 94306
The Law Office of Janet L. Brewer provides comprehensive planning in the areas of Estate Planning, Wills and Trusts, Powers of Attorney, International Estate Planning, Estate Planning for Non-Residents, Probate & Trust Administration, Charitable Planning, Special Needs Planning & Trusts, Estate Tax Planning, Business Succession Planning and Asset Protection for Business Owners and Professionals. Janet has offices in Palo Alto, CA and serves the entire surrounding area, including Palo Alto, Los Altos Hills, Los Altos, Portola Valley, Woodside, Atherton, Menlo Park, East Palo Alto, Mountain View, Sunnyvale and Silicon Valley.
Copyright © IMS. All rights reserved. You may reproduce materials available at this site for your own personal use and for non-commercial distribution. All copies must include this copyright statement. Some artwork provided under license agreement.
Janet L. Brewer is Certified as a Specialist in Estate Planning and Probate Law by the California State Bar Board of Legal Specialization. Information on this website, including any testimonial or endorsement, does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter.