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US Estate Tax

Discussion in 'General Discussion' started by Kevin Lee, Jul 27, 2016.

  1. Kevin Lee

    Kevin Lee Well-Known Member

    According to the US IRS, even non-US residents who own US assets including stocks (or derivatives including options) of US listed companies are subjected to US estate tax when one passes away. Unlike US residents who have a $2M exemptions, for non-US residents, anything above $60K is taxable and I think the current rate is 55% or something ridiculously high. See IRS info https://www.irs.gov/individuals/int...-with-u-s-assets-must-file-estate-tax-returns

    I was told the only way to avoid that is through a limited company registered outside the US. But that might cause other tax and cost issues.

    Can non-US resident traders here who either have done something or knowledgeable about this issue please kindly comment ? Appreciate.
     
  2. Gabor Maly

    Gabor Maly Well-Known Member

    I was not aware of this, thank you for bringing this up.
    As an alternative to the limited company I was wondering if the unlimited estate tax marital deduction rule applies to non-residents for joint accounts as described in the following article http://tax.findlaw.com/federal-taxes/your-brokerage-account-tax-implications-of-joint-tenancy.html, if it does then that could be an option.
    It also makes sense to check local treaties between your country and the US to see regulations and exemptions.
     
  3. Gabor Maly

    Gabor Maly Well-Known Member

  4. Kevin Lee

    Kevin Lee Well-Known Member

    Ya I read that news earlier, thanx. Living in Singapore where taxes are so low and tax codes so simple, what Trump wants to change/repeal in taxes seem obvious to me.
     
  5. Teddy

    Teddy Well-Known Member

    If it becomes low enough, it might be worth the while to move to the US. But don't know if the US economy will be able to handle this and how they will endure a bigger deficit. But hell, they print money anyway.
     
  6. Allan

    Allan New Member

    Kevin, I guess you opened the account through TD Singapore, right? then just sell all the US equities in the account and make it all cash. Then it shall not be entitled to US tax.
     
  7. Gabor Maly

    Gabor Maly Well-Known Member

    But for that we need some computers in afterlife, if you can forsee the event then all good :)
     
  8. Kevin Lee

    Kevin Lee Well-Known Member

    Cash in brokers accounts is taxable whereas cash in savings accounts in a bank is not.
     
  9. Allan

    Allan New Member

    Kevin, I guess TD Singapore is a broker registered in Singapore, so US tax is not applicable, when you are all cash. Is that right? As I may consider to open an account there.
     
  10. Kevin Lee

    Kevin Lee Well-Known Member

    If you read the IRS website, they said cash inside a broker account is subject to estate tax. But TD Singapore told me accounts in Singapore isn't subject to US estate tax. I'm not sure who to believe.
     
  11. onyxperidot

    onyxperidot Well-Known Member

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