International Estate Planning

International planning has been part of our practice for decades. As the world has grown more interconnected, our international practice has grown broader and deeper, and we serve as leaders in this area.

Many of our clients have assets and family in multiple jurisdictions, both in and out of the United States.  They engage us to advise them as to the complex legal and tax matters related to the transfer of their property during the lives and at death.  We also help couples to plan around all the surprising issues that come up when one or both spouses are not U.S. citizens, such how to best use the marital deduction, which has limited availability for non-citizens.  Additional issues may also arise when discussing expatriation and immigration and how either will affect our clients and their families.

For clients with assets offshore, we help to identify the IRS’s reporting requirements, and work with our clients and their other advisors to bring our clients into compliance if they are not compliant already.

Some matters that frequently arise when advising clients with some international connections are:

  • We counsel clients from the U.S. and around the world about their estate plans and their transfers of property. This may include coordinating estate planning documents to cover property in several different countries, and it may include giving advice about U.S. legal and tax consequences associated with owning and transferring international property. We also help U.S. beneficiaries to consider planning opportunities and meet reporting requirements for gifts and inheritances they may receive from their non-U.S. family members and friends. We coordinate our advice with legal and tax opinions from foreign counsel, to give a complete picture of how each plan should work.

  • Many of our clients are surprised to learn that the U.S. strictly limits the amount of property a U.S. person can transfer tax-free to a spouse who is not a U.S. citizen. The limitations apply even if both spouses are permanent residents, and they can be a real trap for couples with assets over the federal or Massachusetts estate tax threshold. There are many opportunities for lifetime planning, each with a different acronym and different pros and cons. We help clients sort through the options to find one that works for their needs. When the worst happens and a spouse dies without proper planning, there is a short window of time during which we can help the surviving, non-citizen spouse to defer estate taxes.

  • We advise high-net-worth individuals regarding their tax and reporting obligations, and planning opportunities, associated with both claiming and with giving up U.S. citizenship and residence. If an individual is considering becoming a U.S. resident and can defer that action for at least five years, there are significant U.S. tax planning opportunities available. If an individual plans to renounce U.S. citizenship, we can estimate the associated exit tax and future transfer tax savings, and suggest planning options that are specific to the client’s circumstances.

  • We counsel individuals, fiduciaries, and their accountants on the U.S. reporting requirements associated with holding and transferring foreign property. You may have heard of the FBAR (FinCEN Form 114), Form 3520, and the BE-10, for example, but there are many more. The failure to file any one of these forms can lead to significant penalties, but the IRS has procedures and programs available for those who qualify. We work closely with accountants to help taxpayers file their past-due FBARs and other forms using the Streamlined Filing Compliance Procedures and, where appropriate, the Offshore Voluntary Disclosure Program.

  • Many foreign nationals purchase U.S. real estate for their own personal use  or for their children to use during college, or during a medical residency. Navigating the U.S. real estate market can be enough of a challenge, but when non-U.S. citizen, non-U.S. residents purchase U.S. real estate interests, they also must navigate a sea of income, gift, and estate tax rules. We guide clients in the purchase of real property in a tax-efficient manner, based on the property’s expected use.