Are you a Foreign National who owns Property in The U.S.?
For many foreigners purchasing property in The U.S.
represents a safe haven. However, it can quickly become a tax burden as a
result of U.S. estate tax impacts on non-resident foreign nationals.
Although U.S. citizens and permanent residents
are afforded a $5.49 million estate tax exemption (adjusted for inflation),
non-resident foreign nationals are generally limited to a $60,000 estate tax
exemption. Which means should they die, his/her heirs could face a tax of up to
40% of the fair market value of the home at the time of the owner’s death.
A smart way to protect your investment from a possible
high U.S. estate tax liability is with a life insurance policy. The U.S. tax
code considers life insurance on the life of a non-resident foreign national as
not “situated within the United States” and, therefore, not included, as part
of their U.S. gross estate. Simply put, the death benefit isn’t subject to U.S.
estate tax at the death of the insured and should go to the heirs and/or
beneficiaries intact. Purchasing a life insurance policy in the amount of
an estimated estate tax liability can help ensure that the heirs and
beneficiaries of a non-resident foreign national will have the funds needed to
pay any assessed U.S. estate taxes.
In addition, the cost of life insurance issued
in the U.S. is very competitive compared with products offered in other
countries and, in some cases, can offer great advantages –—which may not be
available in the foreign national’s home country.
Non-resident foreign nationals must understand
the U.S. tax treatment of their U.S. property to make smart estate planning
decisions.
Have questions? Call me! I can help you answer
them and put you in contact with an expert estate attorney or insurance agent
if needed.
Maria
T Villalobos, CDPE
Realtor Associate - Public
Notary
USA. 786-285-5855
Vzla. 0212-
210-5398
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