There seems to be some risk in a strategy of multiple wills, as the traditional rule holds that the legal execution of a will extinguishes the validity of any property has situs in both (or even in neither) country. Cross Border Estate Planning for Canadians. This example merely highlights that certain classes of investments may be subject to more draconian reporting and taxation rules than other investments. Portability of unused exemption to surviving spouse: Beyond that, if the first-to-die spouse’s exemption amount is not fully utilized, an election on that estate tax return will preserve the remaining unused exemption amount for the second-to-die spouse. Even modest foreign investments in the U.S. may raise transfer tax issues: When non-U.S. persons own U.S. situs assets, including real estate, U.S. corporation stocks, and tangible personal property (e.g., collectibles) that remain in the United States, they are generating a U.S. estate – one with a considerably miniscule exemption of only $60,000. From a tax perspective, the impact on the 2020 U.S. Presidential election will stretch well beyond U.S. borders. If an individual and his or her family have ties across the border, either through residency, citizenship, domicile or the location of an asset, it is important to obtain legal advice from experienced lawyers who can assist in identifying critical issues and preparing a coordinated and effective cross-border estate plan. of the global family change, so will the tax implications and the available solutions. Cross Border Tax Planning for Canadians Moving to the U.S. Canada to Arizona was established to provide Canadians a trusted one stop resource to comprehensive cross border tax and estate planning. A specialist qualification that offers you a detailed insight into the different issues that arise when dealing with cross-border estate planning and succession worldwide. When engaging in cross border financial planning, we determine a client’s cross border tax, estate, investment, retirement, and immigration planning needs in light of their particular goals and objectives. However, in some cases, we may seek and collect data about individuals through publicly available third-party sources, such as social media, news, or company websites. Frequently, it will make sense to own U.S. Real Estate through an offshore corporate or trust structure (for a foreign, non-resident investor only, as U.S. persons should certainly avoid offshore corporate or trust structures) to avoid U.S. estate tax, and possibly reduce U.S. income tax as well. While a country-by-country discussion of the situs rules is beyond the scope of this article, many jurisdictions employ situs rules similar to the U.S. For that reason, standard traditional estate planning tools will not work in those situations. If the QDOT is created after decedent’s death, the surviving spouse is treated as the grantor for income and transfer tax purposes. We provide an array of cross-border estate planning services, including: Our firm is known in the professional community for its ability to create and effectively deliver legal solutions for succession of assets and estate and incapacity planning for clients with connections to both Canada and the U.S. As an internationally-recognized firm that frequently deals with clients with multijurisdictional issues, our legal team can provide you with advice regarding your cross-border estate planning needs. Except in response to direct instructions from you (e.g., a client asks us to send a brokerage tax record to their accountant), we do not share your personal data with third parties. (for more information see Thun Research’s article on PFICs). Since a non-resident alien is generally not subject to taxation by the United By Heela Donsky Walker April 13, 2015. Thun Financial Advisors Privacy Statement was updated in May, 2018, and may be amended from time to time to reflect updated legal requirements or evolving best practices in data collection and protection. If you travel back and forth between Canada and the United States, or have any cross-border property, you should ensure that your estate planning and other documents will be valid in both countries to any extent necessary. Safeguarding Personal Data Section 529 college savings plans (see Thun Financial’s research article on 529 Plans for ex-pats) have grown substantially in popularity over recent years, as parents begin to realize the tremendous long-term advantages to saving larger amounts for college in earlier years for their children, and 529 accounts allow substantial deposits (as much as $150,000 in a one-time gift from joint filers covering a five-year period) and provide Roth IRA-style tax-free growth of the investment account, provided that the 529 plan assets are withdrawn for qualified educational expenses. As a regulated investment advisory firm, we take reasonable and appropriate measures at Thun Financial to protect against the unauthorized or unlawful use of your personal data and to prevent the theft or accidental loss or destruction of your personal consistent with our internal and regulatory security policies and procedures. However, families with multiple nationalities are in particular need of a cross-border estate plan … CROSS-BORDER ESTATE PLANNING By: Gideon Rothschild Moses & Singer LLP 405 Lexington Avenue New York, New York 10174 (p ) (212 ) 554-7806 (f ) (212 ) 554-7700 grothschild@mosessinger.com www.mosessinger.com I. © 2020 Thun Financial Advisors, a division of Creative Planning  |  All Rights Reserved   |, U.S. Citizen inside the U.S.? Cross-Border Successions within the European States & Estate Planning for Canadians Additionally, in Canada, which shares the British common law heritage, a special capital gains tax will be periodically assessed on trusts holding Canadian real property. We do not pay third parties to provide us with lists of personal data. Whether you are transitioning residency between Canada and U.S. or you have already made the move but continue to hold investment assets or financial interests in both Canada and the United States, proper cross-border financial planning can integrate and coordinate the asset management of your investments, reduce taxes and maximize your estate. Thun Financial Data Privacy Statement Michael Kennedy provides representation and counseling related to all facets of estate planning and business enterprise throughout the United States. If you would like to review our data privacy statement, click here. Recently, Cirone's practice has seen an increase in inquiries in the following areas: Planning and preparation of cross-border Wills ("CB Wills") for U.S. citizens living in Canada. The estate planning team must evaluate the interplay of the relevant transfer tax regimes and the pertinent treaty to determine the transfer tax outcome in consideration of not only the nature of the property and its location, but also the impact of citizenship and domicile on net tax outcomes. Box 68 Toronto, ON M5K 1E7, Toll Free: 888-365-6235Phone: 416-363-3336Fax: 416-363-9570, U.S.-Canada Cross-Border Will and Estate Planning, Cross-Border and Multijurisdictional Estate Matters, Contact Us – Estate and Trust Administration, Multijurisdictional Estate Administration, Multijurisdictional and Cross-Border Will and Estate Planning, Cross-border incapacity planning including use of a power of attorney in U.S. jurisdictions, Cross-border will planning and separate situs wills, Cross-border trust planning including Canadian trusts to hold U.S. situs asset. INTRODUCTION A. Non-resident alien taxation 1. Accordingly, if the expat grantor moves to Germany with her family, the children-beneficiaries will be German residents and the intended consequences of the grantor trust will conflict with German gift and inheritance tax laws. Moreover, while each sovereign has their own rules and interpretations of situs rules, the U.S. regime can be somewhat instructive for other countries’ situs rules. We specialize in U.S. & Canadian immigration financial strategy. E state taxes can be a huge liability if you are not properly prepared. • Communicating with you with respect to new research, webinars, or other firm activities or events that may be of interest to you; and Cross-Border Estate Planning for Canadians Residing in the United States 10.17.16. These treaties among the pertinent jurisdictions will alter the path of estate planning. Wills are the common method of establishing a blue-print of specific instructions for passing (bequeathing) wealth to others (spouses, descendants, friends, charities, etc.) As the fact patterns (citizenship, domicile residency, marital history, assets, etc.) through the probate system. The QDOT can be created by the will of the decedent or the QDOT can be elected within 27 months after the decedent’s death by either the surviving spouse or the executor of the decedent’s estate. A United States expat family, a U.S. person married to a non-citizen spouse, a non-U.S. person investing in the United States, or other families with multiple nationalities, will need to have an investment plan that is correctly in sync with a tailored cross-border estate plan. Residency, without the requisite intention to remain, will not create domicile, but domicile, once created, will likely require an actual move outside the country (with intention to remain outside) to sever it. * Applicable Membership or Subscription discounts will be added in your shopping cart Description: . Cross border trust and estate planning . The savvy expat or multinational investor also needs More Publications Publication Canadians With U.S. Part of the Raymond James Financial family of companies, Raymond James (USA) Ltd., or RJLU, is a Canadian based US registered investment firm offering integrated cross-border wealth management solutions to Americans living in Canada and Canadians living in the US.As RJLU advisors, we are licensed and regulated in both Canada and the US, … Cheyenne received her J.D. Correctly tailoring that cross-border estate plan will require legal and tax experts with a deeper understanding of the relevant estate/succession/gift/generation-skipping transfer (collectively referred to herein as “transfer”) tax laws in each of the relevant countries that may factor in the distribution of property prior to and upon death. $11.4 million personal lifetime exemption (2019). More concerning, it will also subject the foreign, non-resident to a more complicated tax regime – the Foreign Investment in Real Property Tax Act (FIRPTA) – which creates a myriad of tax headaches that are well beyond the scope of this article. Cross Border Living and Tax Planning. A United States expat family, a U.S. person married to a non-citizen spouse, a non-U.S. person investing in the United States, and other cross-border families will need to have an investment plan that is correctly in sync with a tailored cross-border estate plan. 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