The United States has a very complicated system of taxing deceased estates.
This can be particularly relevant if you or your client is a US citizen living in Australia or if you or your client has significant holdings of assets in the United States.
In addition to being very complicated, there has been much uncertainty as to what exemptions were available for individuals.
On 2 January 2013, the American Taxpayer Relief Act 2012 was signed.
Among other things, that Act has provided certainty in relation to estate taxes in the US at a Federal level.
In summary:
- A$5,000,000 threshold exemption, with adjustments for inflation, now exists.
- Estates above the exemption are subject to an estate and gift tax at a maximum rate of 40%.
As you can appreciate, when undertaking estate planning for individuals who are US citizens or who have assets located in the US, it is important that we work closely with US attorneys.
At KCL Law, through our special interest US Group, we have developed relationships with attorneys in the United States that specialise in estate planning and can work with us and you to best address these complicated issues.
More information
For more information, please contact Sam Frey, Principal and Head of our Estate Group or David Weinberger, Principal Lawyer and Head of our US Practice and Litigation and Dispute Resolution Practice on (03) 8600 8888.
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