New Estate and Gift Tax Limits Don’t Apply to Non-U.S. Citizen Estates

Immigration & the New Estate Tax Limit

Immigration and the New Estate Tax Limit
U.S. Citizens can shield up to $5.45 million (per person) of their U.S. estate from federal estate taxes.

According to the IRS, an estate tax is a tax on your right to transfer property at your death. It consists of an account of everything you own or have certain interests in at the date of death. Generally, the estate must pay taxes on the total net worth of the worldwide estate. Fortunately, there are some exemptions that shield part or all of the estate from taxes.

The IRS recently announced the new estate and gift tax exemption is $5.45 million per person, or $10.9 per married couple. This number is up from the previous federal estate tax exemption of $5.43 million per person.

This is great news if the estate is owned by a U.S. Citizen, considering the top federal estate tax rate is a whopping 40%. The list below shows some of the IRS federal tax rates.

2015 Federal Estate Tax Rates

                                                Taxable Amount

Tax Rate

                                               $10,001 – $20,000 20 %
                                               $60,001 – $80,000 26 %
                                               $150,001 – $250,000 32 %
                                               $750,001 – $1,000,000 39  %
                                               $1,000,001+ 40  %

Foreign individuals only receive a federal estate tax exemption for $60,000. That means if you are a non-U.S. citizen who owns real or personal property in Florida worth over $60,000 in value, you may owe a substantial portion of that estate to the U.S. federal government in the form of taxes. If your estate is worth more than $60,000, you should consult with a wills and trusts attorney to prepare your estate plan.

U.S. Immigration and the new estate tax limit go hand in hand.

If you aren’t already a U.S. Citizen and you want to shield $5.45 million of your estate from the U.S. federal government, you should consult with an immigration attorney to discuss your potential to qualify for U.S. Citizenship.

Two of the most common avenues to becoming a United State citizen is the EB-5 investor visa, and the family petition. If you qualify for U.S. Citizenship through Naturalization and the value of your estate exceeds $5.45 million, then there may be other money-saving options available. For instance, you can create a trust or take out life insurance.

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