U.S. Estate Planning Considerations for Canadians

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U.S. Estate Planning Considerations for Canadians

Earlier today, Michael Kennedy gave a presentation on U.S. Estate Planning Considerations for Canadians to a group of RBC Financial Planners in Windsor, Ontario.  There are many issues Canadians must understand if they own property situated in the U.S., which includes U.S. real estate, financial or retirement accounts with U.S. financial institutions and shares in U.S. companies, among other things.  High net worth U.S. citizens living in Canada must also understand the effects of the U.S. estate tax.

There are 10 key questions to ask yourself or your client, if you represent Canadians with U.S. property or high net worth U.S. citizens living in Canada:

  1. What is the U.S. Estate Tax?  
  2. What property is subject to the Estate Tax?
  3. Does the Canada – U.S. Tax Treaty provide help?
  4. What is the U.S. Gift Tax?
  5. What happens to my property in the United States upon my death?
  6. Do I need a U.S. will to cover my property in the U.S.?
  7. If my property in the United States avoids probate, is it subject to the Estate Tax?
  8. What happens if I lack capacity to make my own decisions regarding property and health?  
  9. How should I own property in the United States?   
  10. What happens to my U.S. property in the event I get a divorce?


You can find the answers in the attached presentation “U.S. Estate Planning Considerations for Canadians


Some quick take-aways from today’s presentation:

  • Canadians need state-specific U.S. estate planning documents such as durable power of attorney, designation of health care surrogate and last will & testament covering U.S. property.
  • Don’t add anyone to title of U.S. property – otherwise you’ll be hit with U.S. gift tax.
  • Watch out for Corporate Owned Life Insurance as it triggers estate tax for U.S. citizen shareholders and income tax for U.S. heirs.
  • Even if probate is not required to transfer an asset, an IRS Transfer Certificate is still necessary.
  • A Canadian divorce has significant U.S. tax considerations where 401k, IRA or U.S. real estate are involved.
  • Selling U.S. property?  Watch out for the 15% withholding tax; 35% for Canadian corporations.


If you have any questions, please feel free to contact our office at 519-252-3888 or email mk@ingenuitycounsel.com.


About the Author

Michael Kennedy and his team at Ingenuity Counsel Incorporated work with clients that own property in the U.S. in states such as Florida, Michigan, Arizona & California, among others.  He advises them on cross border estate planning & the consequences of owning property in a foreign country.  Michael handles wills & trusts, powers of attorney and probate administrations.  Whether you have real property, financial accounts or business assets located in the United States, Michael and his team can help.  Additionally, he counsels companies and entrepreneurs expanding into the United States in areas such as immigration, business, real estate and tax.  

Michael is a graduate of Western New England College School of Law in Springfield, Massachusetts (J.D.), Georgetown University Law Center in Washington, DC (LL.M. in Tax) and the University of Windsor (B. Comm.) and is admitted to practice law in the States of California & Michigan and permitted by the Law Society of Upper Canada to provide U.S. legal services in Ontario as a Foreign Legal Consultant.  

Prior to establishing Ingenuity Counsel in 2012, he practiced law in the United States for more than 10 years in California, Michigan and Florida.  To learn more about Michael and Ingenuity Counsel, visit www.ingenuitycounsel.com.  


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