International relations – Estate planning for noncitizens
Abstract: For U.S. citizens, the federal gift and estate tax rules are relatively straightforward: Citizens are subject to U.S. transfer taxes on their worldwide assets. They’re also entitled to a generous lifetime gift and estate tax exemption, an annual gift tax exclusion, and a marital deduction that allows spouses to transfer unlimited amounts of property to each other tax-free. For noncitizens, however, it’s more complicated. If a significant amount of their wealth is situated in the United States, their heirs may be facing a substantial estate tax bill. This article discusses the determination of situs and eligibility for the marital deduction and looks at options to minimize adverse tax consequences.