Wealth Preservation, Trusts and Estates

Federal Estate Tax Will Apply To Non Resident Aliens. It is very important for Non Resident Aliens owning assets in the United State (U.S.) to know that their U.S. assets will likely be subject to a U.S. Federal Estate Tax. Many people think they have to take up residency in the United States for the Federal Estate Tax to apply. Read here for some of the details on this tax. The estate of a Non Resident Alien holding U.S. based assets at death will have to file I.R.S. form 706-NA.

Please feel free to contact Douglas L. Kaune, Esq. any time at 610-933-8069 or dkaune@utbf.com to discuss estate tax planning for non-U.S. citizens and important steps to take to protect your assets from the estate tax.

Wills * Trusts * Elder Law * Probate * Asset Protection * Power of Attorney * Estate Planning
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The Qualified Domestic Trust (QDOT) is an imortant estate planning option for married couples composed of at least one non U.S. citizen. The United States federal estate tax laws are very different as they relate to a surviving spouse who is not a U.S. citizen compared to a citizen spouse. In particular the surving non-citizen spouse in not given an unlimited marital deduction for assets passing from his or her spouse at death. Therefore, some portion of the assets left to the surviving non citizen spouse could be subjected to a federal estate tax at rates in excess of 40%. The QDOT is one estate planning tool used to defer the estate tax owed by the non-citizen surviving spouse. The QDOT can be created under a last will and testament, a revocable living trust or as a stand alone trust. Transfers made at death to a QDOT for the benefit of a non-citizen spouse will qualify for the marital deduction and will not be taxed at that time. The creation of the trust mechanism is not sufficient and must be coupled with prudent lifetime planning and asset titling. Read here for additional information on the international estate planning issues generally.
To add to the complexity of this issue, the overall U.S. federal estate tax system is unsettled. As we have discussed on numerous occasions on this site, the federal estate tax was technically repealed on January 1 2010 but there is extensive discussion of the estate tax being reinstituted by Congress retroactively to January 1, 2010. We will continue to address other estate planning concerns of non-U.S. citizens and U.S. citizens alike in later Blog entries.
Please feel free to contact us any time at 610-933-8069 or dkaune@utbf.com to discuss your particular circumstances to determine the appropriate planning options for you.
Wills * Trusts * Elder Law * Probate * Asset Protection * Power of Attorney * Estate Planning
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