TAX & ESTATE PLANNING FOR U.S. CITIZENS

Unlike in Canada, the U.S. has an estate tax that taxes its citizens on their right to transfer property on death. It consists of an accounting of everything a U.S. citizen owns or has certain interests in at the date of death wherever located. The fair market value of these items (on date of death) is used, not necessarily what was paid for them or what their values were when acquired. The includible property may consist of cash and securities, real estate, insurance, trusts, annuities, business interests and other assets.

With the enactment of the American Taxpayer Relief Act of 2012, the gift, estate, and GST tax exclusion amount stands at $5.0M, adjusted annually for inflation. The IRS-issued inflation-adjusted amount for 2014 is $5.34 million per person. Any U.S. estate above this amount is subject to the estate tax.

U.S. citizens living in Canada are fully subject to the U.S. estate and gift tax regimes. A U.S. citizen’s worldwide estate is subject to the estate tax upon death. We can work with you on a plan to minimize U.S. estate taxes. There is no one size fits all estate plan.

We also regularly consult with insurance brokers on the proper ownership and structure of life insurance for anyone that owns U.S. property or is a U.S. citizen.

Our services include:

  • Advice relating to U.S. estate tax liability for U.S. citizens
  • Preparation of U.S. estate and gift tax planning memorandum
  • Preparation of Form 706 – United States Estate Tax Return
  • Preparation of Form 709 – United States Gift Tax Return
  • Review Canadian Will for U.S. Estate Tax Purposes

The consequences of inadequate estate planning can create a significant U.S. estate tax bill for your family – sending a large portion of your estate to the IRS unnecessarily would be a disastrous result of poor planning.  There is an added level of complication when an individual has connections to both the U.S. and Canada, which requires expertise in cross border tax and estate planning. Let us use our years of experience to avoid many of the negative consequences that can arise from a lack of cross border planning.

Contact us today at info@ingenuitycounsel.com or by phone at (519) 252-3888.

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