Canadian residents who are neither citizens, nor residents, of the United States can be subject to US estate tax?
The application of the estate tax rules depends on an individual's US residence status at the time of death as well as the Fair Market Value (FMV) of assets they own in the United States—including real estate, stocks and other tangible property.
While the American Taxpayer Relief Act, which came into effect on January 1, 2013, alleviates some of this tax burden—in that it sets the maximum US estate tax rate at 40 percent and the exemption amount at $5 million—without proper planning, surviving family members can end up losing a large portion of their loved ones' estates to the US government.
This article offers tips Canadian residents can exercise to protect their estates from Uncle Sam—including pertinent estate tax credits and available additional Treaty relief. It also outlines estate tax filing requirements, tax planning strategies and a list of US property types that are subject to the estate tax.
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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
