Tax Treatments And Filing Requirements

In the absence of a treaty, the estate of a non-US alien individual is allowed a unified credit of $13,000, which means that such an estate can transfer $60,000 worth of US-located property without tax. The exempted amount for a non-U.S. person’s estate is significantly lower than that for a U.S. person’s estate. However, suppose an estate tax treaty is available. In that case, a foreign estate with U.S. assets may invoke such treaty provisions under certain circumstances to mitigate its U.S. estate tax liabilities. The United States currently has estate tax treaties with Australia, Austria, Canada, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Japan, the Netherlands, South Africa, Switzerland, and the United Kingdom.

When the U.S.-situated properties in a foreign estate exceed $60,000, the executor is required to file Form 706-NA within nine months of the date of the decedent’s death. When filing Form 706NA, the executor of the estate is recommended to attach the following documents: