Cross-border families leave the U.S. or enter the U.S. for a variety of reasons–jobs, military deployment, to be closer to their families and to pursue business opportunities. They develop relationships, marry, go to school, further their careers, and create new lives outside their native country. The result? They are all exposed to, and affected by, the clash of tax laws between the other countries and the U.S.

Cross-border families include:

  • Americans living abroad
  • U.S. residents of foreign origin
  • Non-U.S. residents who are investing within the United States
  • Non-U.S. residents with family members who live in the U.S.

Estate planning for these individuals and families is difficult due to the cross-border tax implications. If done incorrectly, the heirs to the estate may be stuck with a large estate tax burden. At Lin Tax Law, our international tax and estate planning expertise minimizes the estate tax exposure.

The need to coordinate the overall transfer taxes in various jurisdictions

Correctly developing a cross-border estate plan requires an understanding of the transfer tax laws in the U.S. and working with tax professionals in the relevant jurisdictions to minimize the overall worldwide estate-tax burden. Regardless of where a U.S. citizen lives or dies, U.S. transfer taxes still apply. The United States currently has estate and/or gift tax treaties with certain countries. These treaties help determine the transfer-tax consequences of assets held within the cross-border estate and can help reduce estate taxes by mitigating double taxation and discriminatory tax treatment.

Careful planning for transfer of assets to legally minimize taxes

Careful planning is required not only to ensure the proper passage of assets to heirs as intended, but also to ensure that they’re allocated in a tax-efficient manner. There is a misperception that international estate planning is limited to minimizing U.S. estate or gift taxes. When assets or heirs cross borders, income-tax planning and compliance issues can become as important as estate and gift-tax considerations. The failure to consider U.S. income tax and compliance issues may result in the payment of substantial tax or penalties to the IRS.

Lin Tax Law provides expert counsel for clients with complex international estate-planning situations. We:

  • Advise our clients on setting up foreign trusts with U.S. heirs and gifting real estate and property inside and outside the U.S. to both international and U.S. heirs.
  • Work with local counsel in foreign jurisdictions to coordinate global estate planning for U.S. taxpayers and multinational families.
  • Represent foreign clients with U.S. business interests and/or family members in the U.S., helping them structure their U.S. investments to minimize U.S. taxes and advise them on tax-efficient methods of transferring those investments to succeeding generations.

Contact Lin Tax Law to schedule a consultation.