fbpx Ask An Expert

Want to read more? Sign Up For Our 7-Day Free Trial

Search
Close this search box.

What Special Rules Must Be Considered When Estate Planning For A Spouse Who Is Not A U.S. Citizen?

Man proposed for marriage

The Marital Deduction is Intended to Defer Estate Tax – Not to Avoid Estate Tax

When one spouse dies, he or she can leave assets outright or in a special kind of a trust for the benefit of the surviving spouse.  That type of transfer typically qualifies for the marital deduction.  The martial deduction defers  estate tax until the second spouse dies.  In that sense, the marital deduction is like a “deal” with the IRS – no estate tax will be paid on the first spouse’s death, but the estate tax will be collected on the second spouse’s death.

A similar rule applies to lifetime gifts made by one spouse to another.  Each give (either outright or to a special kind of a trust) qualifies for the marital deduction.  There is no gift tax consequence of making such gift, but when the done spouse dies estate tax on that asset will be collected by IRS.


Want To Read More? Sign Up For Our 7 Day Free Trial.

Please login below. If you don't have an account, feel free to sign up and get access to the entire WealthCAP HUB®.

suggestion

Feedback

Upgrade your account

To access the download article feature, please upgrade your account to Corporate+ or above.