Gift and Estate Tax for United States Expatriates living in Thailand
Gift and Estate Tax for United States Expatriates living in Australia
As earlier stated in my Blogs, US citizens are taxed on their worldwide income regardless of where they reside. As bad as that issue is they also suffer from estate taxation when they pass away. In typical Orwellian tax form, they also suffer additional hazards if they are married to a foreign spouse. Under normal circumstances the US citizen spouse passes assets passed to the surviving spouse with an unlimited estate tax exemption. However if the surviving spouse is not a US citizen the unlimited estate tax exemption is not allowable. One immediate impact of this is that gifts to foreign spouses are limited. In 2016 it is possible to gift a foreign spouse 148,000 (this amount is indexed for inflation and is up from 147,000 in 2015). It is notable that the estate tax does not kick in until the estate reaches 5.45 million for the year 2016. All of this makes estate planning for US expatriates extremely complicated because they are subject to complex rules that are outside of the already arcane set of rules for estate planning and gifting. If you are married to a foreign spouse and you have an amount of assets that is approaching the estate tax exemption maximum or you are considering gifting your foreign spouse funds or assets make sure to contact a qualified US international expatriate tax specialists.