How do you manage estate tax risk as non-US trader?

Discussion in 'Taxes and Accounting' started by learner88, Feb 19, 2021.

  1. Foreigners have substantial estate tax when they invest in U.S stocks. How do you manage this risk?
  2. ph1l


    Sell the U.S. stocks before you die, and don't stay in the U.S. for more than 183 days that year.
  3. May not work in many cases. Get killed in accident. Or suddenly die in heart attack without warning.

    Nobody can know in advance when he is going to die. Maybe cancer patients who have been forewarned by doctor but in many cases, we won't know.
  4. ph1l



    Of course you usually won't know exactly when you will die. It sounds like you might want to contact a tax accountant or a lawyer specializing in estates.
  5. ET180


    Bitcoin. If it's good enough for ransomware, it's good enough to escape the estate tax.
  6. It depends how much you have in US assets relative to your entire estate and where you reside. For Canadians there's a tax-treaty which includes a unified credit pro-rated based on the ratio of US assets to the total worldwide estate. The following site provides an example:

    So for a $12M estate where 25% ($3M) is in US assets the total estate tax due is $41K which is insignificant compared to the overall value. Your mileage will vary but in this case it makes a lot of sense to keep your US assets as a small percentage of your overall assets thereby keeping any US estate tax to a minimum.

    Definitely something to be aware of and plan accordingly.

    However you look at it it will be messy and will involve lawyers, etc. so there will expenses and/or tax involved.
  7. Geissbock


    Some countries, for example Germany, have double tax treaties covering estate tax with the US.