IRS nonresident alien estate tax: the $60,000 US situs assets exemption explained
A nonresident who is not a US citizen can face US federal estate tax with only $60,000 of US-situated assets, a threshold that is not indexed for inflation. That is very different from the $15 million basic exclusion amount for US citizens and US domiciliaries who die in 2026.
The IRS nonresident alien estate tax exemption 60000 US situs assets rule matters to foreign investors who own US corporate shares, US-listed funds, real estate, or other US property. Estate tax vs inheritance tax is also an important distinction: federal estate tax is imposed on the transfer from the estate, rather than on the heir simply receiving property.
What are US situs assets? The complete guide for nonresident aliens
US situs assets are property treated as located in the United States for federal estate-tax purposes. For a nonresident who is neither a US citizen nor US domiciliary, Form 706-NA can become relevant once US-situated assets plus applicable adjusted taxable gifts exceed $60,000.
The US situs assets definition covers property the estate-tax rules locate in the United States, including US real estate, tangible property physically in the US, and stock of domestic corporations. Certain bank deposits, foreign-company stock, and life-insurance proceeds on the decedent’s life are generally outside US situs.
For a nonresident who is not a US citizen, US estate tax generally reaches the decedent’s US situs assets, while the ordinary unified credit is only $13,000 – equivalent to the tax on the first $60,000 under the rate schedule.
The IRS uses separate estate-tax situs rules for different asset types. A foreign investor therefore cannot determine US situs assets for estate tax purposes merely from where a brokerage account is opened or where a share certificate is stored.
TFX’s guide to federal estate-tax considerations for foreigners investing in the United States explains how the US estate-tax rules can affect non-US investors. The IRS also maintains the current Form 706-NA filing page for nonresident estates.
US situs assets definition: what counts and what does not
The US situs assets definition depends on the asset, not simply the owner’s physical location. Under current Form 706-NA instructions, domestic corporate shares are US situs, while foreign corporate shares are generally outside US situs; real and tangible property is ordinarily tested by its physical location.
Stock of a US corporation is a US situs asset for estate tax purposes regardless of where its certificate is physically held.
The following two groups show the main intangible assets estate tax treatment and tangible-property rules used by the IRS.
| Included as US situs | Generally excluded from US situs |
|---|---|
| US real property, including land and buildings | Real property outside the United States |
| Tangible personal property physically in the US, subject to limited exceptions such as qualifying exhibition art | Tangible personal property outside the US |
| Shares of corporations organized under US law | Shares of a foreign corporation |
| US debt obligations unless a statutory exception applies | Qualifying portfolio-debt obligations |
| Bank deposits connected with a US trade or business | Qualifying bank deposits not effectively connected with a US trade or business |
| Certain transferred property that meets the US-situs test under IRC §§2035–2038 | Proceeds of life insurance on the life of the NRNC decedent |
The practical dividing line is that physical US property and domestic-company stock are commonly US situs, while several specifically excluded financial assets remain outside the US estate-tax base.
Foreign bank accounts estate tax treatment therefore differs from the treatment of US corporate stock. A bank account’s result depends on the statutory deposit rules and whether it is effectively connected with a US trade or business.
For a broader distinction between income-tax and transfer-tax classifications, see TFX’s US tax rules for resident and nonresident aliens.
Are shares of a foreign corporation US situs assets for estate tax?
Shares of a foreign corporation are generally treated as property located outside the United States, even when the foreign corporation itself owns US assets. The current Form 706-NA instructions state that domestic corporate stock is US situs and “all other corporate stock” is outside US situs.
Owning shares of a foreign corporation that holds US property does not automatically make the shares US situs assets, but special statutory rules can change the result in narrow cases.
This answers the awkward keyword question “are shares of foreign corporation us situs assets estate tax” in practical terms: ordinarily, no. The shareholder owns foreign-company shares rather than the underlying US property directly.
A notable exception applies to certain former US citizens or long-term residents who expatriated after June 3, 2004, and before June 17, 2008. Under IRC §2107, a qualifying person can be treated as owning a prorated share of US property held by a foreign corporation if ownership thresholds are met.
A foreign corporation also creates separate corporate, income-tax, FIRPTA, financing, and home-country considerations. TFX’s overview of offshore corporation benefits and disadvantages provides context on entity ownership beyond the estate-tax situs rule.
US ETFs and mutual funds: are they US situs assets for nonresident aliens?
A US-domiciled ETF or mutual fund organized as a domestic corporation is generally treated as US corporate stock and therefore as a US situs asset. That means a foreign investor can cross the $60,000 Form 706-NA threshold through a securities portfolio without owning US real estate.
A nonresident investor holding more than $60,000 of US-domiciled ETF shares can have a Form 706-NA filing exposure even when the underlying fund invests heavily outside the United States.
For deaths in 2026, investors should not rely on the old regulated investment company look-through rule in IRC §2105(d). The current Form 706-NA instructions describe that special rule only for NRNC decedents who died after 2004 and before 2012.
An Ireland-domiciled ETF is commonly considered in place of a US-domiciled fund because shares of a genuinely foreign corporation are generally outside US situs. Investment regulation, dividend withholding, fund costs, the investor’s residence-country tax rules, and other consequences still need separate review.
This is why US estate tax for nonresident aliens, US situs assets, and ETFs should be analyzed at the fund-domicile level rather than from the exchange ticker alone. TFX’s tax guide for non-US investors holding US property and investments covers related US tax reporting issues.
The $60,000 estate tax exemption for nonresident aliens explained
The ordinary nonresident alien estate tax exemption is commonly described as $60,000, but technically the statute provides a $13,000 unified credit. Under the unified rate schedule, $13,000 is exactly the tentative estate tax on the first $60,000, creating the familiar $60,000 result.
The $60,000 NRNC threshold has not increased with inflation, while the 2026 basic exclusion amount for a US citizen or US-domiciled decedent is $15 million.
The 60000 estate tax exemption nonresident rule therefore creates a large difference between a foreign non-domiciliary and a US domiciliary. The nonresident alien estate tax threshold also applies for filing purposes together with the decedent’s gift-tax specific exemption and adjusted taxable gifts.
Based on a common TFX client scenario. Based on our client scenario at TFX: assume an NRNC decedent owns $200,000 of US corporate shares, has no adjusted taxable gifts, no deductible expenses, and no applicable treaty benefit. Tentative tax on $200,000 is $54,800; subtracting the ordinary $13,000 unified credit produces approximately $41,800 of federal estate tax.
A treaty can materially change that result. Some treaty provisions permit a prorated exemption or unified credit based on US property compared with the worldwide estate, while other treaties use different rules.
TFX’s Form 706-NA guide for nonresident estates explains the return itself, and the current IRS Form 706-NA instructions provide the filing and computation rules.
US estate tax rates for nonresident aliens: how much could be owed?
A nonresident alien estate uses the same federal unified rate schedule referenced by Form 706, with marginal rates from 18% to 40%. The ordinary $13,000 NRNC unified credit offsets the tax on the first $60,000, rather than creating a separate flat 40% tax above $60,000.
For a taxable amount above $1 million, the unified schedule reaches a 40% marginal rate, so US situs assets estate tax can become material well before a foreign investor has a multimillion-dollar worldwide estate.
The 2026 unified rate schedule used to calculate the tentative federal estate tax is:
Above $1 million of taxable transfers, the marginal federal estate-tax rate is 40%; the ordinary NRNC credit remains only $13,000 unless another rule or treaty changes it.
| Taxable amount over | Not over | Tax on lower amount | Rate on excess |
|---|---|---|---|
| $0 | $10,000 | $0 | 18% |
| $10,000 | $20,000 | $1,800 | 20% |
| $20,000 | $40,000 | $3,800 | 22% |
| $40,000 | $60,000 | $8,200 | 24% |
| $60,000 | $80,000 | $13,000 | 26% |
| $80,000 | $100,000 | $18,200 | 28% |
| $100,000 | $150,000 | $23,800 | 30% |
| $150,000 | $250,000 | $38,800 | 32% |
| $250,000 | $500,000 | $70,800 | 34% |
| $500,000 | $750,000 | $155,800 | 37% |
| $750,000 | $1,000,000 | $248,300 | 39% |
| $1,000,000 | No upper limit | $345,800 | 40% |
Based on our client scenario at TFX: if an NRNC has a $1 million taxable US estate, no adjusted taxable gifts, no deductions, and no treaty relief, the tentative tax is $345,800. After the ordinary $13,000 unified credit, the federal estate-tax amount is approximately $332,800.
Foreign death-tax relief is country- and treaty-specific, so it should not be assumed either available or unavailable without checking the applicable foreign law and treaty.
Form 706-NA: filing requirements for nonresident alien estates
Form 706-NA filing requirements generally apply when the date-of-death value of a nonresident noncitizen’s US-situated assets, plus the gift-tax specific exemption and adjusted taxable gifts, exceeds $60,000. The return is filed by the executor, personal representative, administrator, or another person treated as executor under the instructions.
Form 706-NA preview
An estate can have a Form 706-NA filing obligation even when deductions, credits, or treaty benefits later reduce the final US estate tax to $0.
The following 5 requirements cover the core estate tax return for nonresident alien estates:
- Determine who must file. The decedent must have been neither a US citizen nor US domiciliary at death. If the statutory filing calculation exceeds $60,000, the executor generally files Form 706-NA.
- Calculate the filing threshold correctly. The test is not limited to the net taxable estate. It includes date-of-death US-situated assets, the applicable gift-tax specific exemption, and adjusted taxable gifts.
- Attach the required schedules and evidence. Depending on the entries, the estate may need schedules from Form 706, a certified copy of the will, the death certificate, appraisals, corporate financial information, and other supporting documents.
- Identify the responsible executor. If no executor is appointed, qualified, and acting in the United States, a person in actual or constructive possession of the decedent’s property can fall within the Form 706-NA definition of executor.
- File at the current IRS address. The September 2025 Form 706-NA instructions direct ordinary mail to the Internal Revenue Service Center in Kansas City, Missouri; private delivery services use the separate street address listed in those instructions.
The Form 706-NA instructions also tell estates to use the version of Form 706 and its instructions corresponding to the decedent’s date of death when completing required schedules and valuations.
Form 706-NA deadlines: when must the estate tax return be filed?
Form 706-NA is normally due 9 months after the date of death. If more time is needed to file, Form 4768 can provide an automatic 6-month filing extension, but an extension to file does not automatically extend the time for paying estate tax.
Missing the 9-month Form 706-NA deadline can result in late-filing additions, late-payment additions when tax remains unpaid, and statutory interest on the outstanding balance.
For a return subject to IRC §6651, the basic failure-to-file addition is generally 5% of unpaid tax for each month or partial month, up to 25%, while the basic failure-to-pay addition is generally 0.5% per month, also subject to a 25% ceiling and coordination rules.
Interest changes quarterly. For the third quarter of 2026, the IRS underpayment rate is 7% annually, compounded daily, and the IRS has announced the same 7% rate for the fourth quarter beginning October 1, 2026.
Must Form 706-NA be filed if a treaty eliminates all US estate tax?
Possibly. A treaty that reduces the final federal estate tax to $0 does not create one universal rule that every estate can skip Form 706-NA; the filing result and documentation depend on the statutory threshold, the specific treaty provision, and the IRS instructions for the treaty claim.
Treaty relief should be claimed and documented in the manner required by the applicable treaty and Form 706-NA instructions rather than assumed to apply automatically.
The current instructions say that if items on Form 706-NA are reported based on a death-tax treaty or protocol, the executor should attach a statement identifying the treaty-based return position. Certain treaty provisions contain additional reporting mechanics.
For example, the instructions provide specific return treatment for the Canada small-estate provisions and a separate limitation computation for qualifying UK treaty cases. That is why the query “706-na required if no us situs assets according to treaty” cannot be answered with a blanket yes or no without reading the treaty itself.
Where the statutory filing calculation exceeds $60,000, filing Form 706-NA and clearly disclosing the treaty position is generally the safer procedural path unless the treaty and current IRS instructions support a different result.
Get help with your US estate tax exposure
Foreign investors can cross the $60,000 Form 706-NA threshold through securities or property they may not have considered part of a US estate. TFX can help you identify the relevant filing requirements and organize the information needed for an international return.
Review TFX’s US expat and international tax return service if you need help with a US filing involving cross-border assets.
Estate tax treaties: how they can increase the NRA exemption
The United States currently lists 15 countries with estate or estate-and-gift tax treaty provisions. A treaty can change situs rules, deductions, credits, or the amount of US tax, and certain treaties allow a proportionate unified credit that can exceed the ordinary $13,000 NRNC credit.
Under certain US estate-tax treaties, an NRNC estate can qualify for a proportionate unified credit based on the relationship between US-situated property and the worldwide estate, but the formula is treaty-specific.
As of September 28, 2026, the current IRS estate and gift treaty list covers these 15 countries:
- Australia
- Austria
- Canada
- Denmark
- Finland
- France
- Germany
- Greece
- Ireland
- Italy
- Japan
- Netherlands
- South Africa
- Switzerland
- United Kingdom
The current Form 706-NA instructions specifically identify Australia, Canada, Finland, France, Germany, Greece, Italy, Japan, and Switzerland as treaties that contained provisions to which IRC §2102(b)(3)(A) applied when those instructions went to print.
Canada is an important exception to any shorthand statement that an income tax treaty never affects estate tax. Its estate-tax provisions appear in Article XXIX B of the US–Canada income tax treaty.
For other countries, an income tax treaty should not be assumed to provide estate-tax protection merely because one exists. A nonresident alien estate tax treaty analysis requires the actual death-tax provisions and any protocol in force at the date of death.
TFX’s guide to the substantial presence test and US tax status for foreign nationals explains the separate income-tax residency framework.
Domicile vs. residence: the critical distinction for US estate tax
For federal estate tax, a foreign national is an NRNC only if the person was neither a US citizen nor domiciled in the United States at death. The income-tax substantial presence test does not determine estate-tax domicile, and lawful permanent resident status by itself is not conclusive.
A foreign national can be a US income-tax resident yet remain a nonresident for federal estate-tax purposes because transfer-tax residence turns on domicile rather than the income-tax residency tests.
IRS regulations describe domicile as living in a place, even for a brief period, with no definite present intention of later moving. Facts such as the person’s home, family, business ties, statements of intent, length of stay, property ownership, and connections elsewhere can be relevant.
A work visa does not automatically establish or defeat domicile. The same is true of the substantial presence test estate-tax distinction: meeting the day-count test for income tax does not by itself make someone a US domiciliary for estate tax.
US citizenship is separate. A US citizen generally remains subject to federal estate tax on worldwide assets even when living abroad.
TFX’s guide to defining US alien tax status explains the related income-tax classifications.
Green card holders and US estate tax: a different set of rules
A green card holder is not automatically a US domiciliary for estate-tax purposes. If the person was US domiciled at death, Form 706 and worldwide-estate rules generally apply; if the person was not US domiciled and was not a citizen, the Form 706-NA US-situs regime can apply instead.
Green card status is relevant evidence, but the IRS expressly states that holding a green card is not conclusive proof of US domicile for estate and gift tax.
This distinction is important because a US-domiciled noncitizen who dies in 2026 can generally fall under the $15 million basic exclusion framework applicable to Form 706, while an NRNC ordinarily starts with the $13,000 credit equivalent to $60,000.
A noncitizen surviving spouse raises a separate marital-deduction issue. Unless a treaty permits another result, property generally must pass to a qualified domestic trust (QDOT) for the estate to obtain the marital deduction when the surviving spouse is not a US citizen.
TFX’s tax guide for green card holders with undeclared foreign assets discusses related international reporting. The IRS provides the current Form 706-QDT resources for qualified domestic trusts.
US real estate as a US situs asset: what foreign owners must know
US real property is a US situs asset for an NRNC estate when it is physically located in the United States. Residential homes, commercial buildings, and land are generally included at fair market value on the date of death, subject to the estate-tax valuation rules.
There is no separate de minimis exception for US real estate: a foreign owner whose overall statutory Form 706-NA filing calculation exceeds $60,000 can create a federal estate-tax filing obligation.
Fair market value of US property is not necessarily the original purchase price or local tax-assessment value. The executor should obtain support appropriate to the property, and an independent appraisal is commonly needed for real estate reported on an estate-tax return.
The IRS also has an active compliance campaign addressing nonresident alien rental income from US real property. That campaign concerns income-tax reporting rather than a separate estate-tax campaign, but it shows that foreign ownership of US real estate can produce tax obligations during life as well as at death.
TFX’s report on the IRS compliance campaign involving nonresident aliens with US real property provides more context.
Life insurance and US estate tax for nonresident aliens
Proceeds of an insurance policy on the NRNC decedent’s own life are treated by the Form 706-NA instructions as property located outside the United States. The exclusion is based on the nature of those proceeds, not simply on where the insurance company or beneficiary is located.
Life-insurance proceeds on the life of an NRNC decedent are generally outside US situs for federal estate-tax purposes.
That rule is useful in life insurance nonresident alien estate tax planning, but it should not be stretched beyond its wording. If an NRNC owned a policy on another person’s life, the estate owns a separate property interest rather than proceeds on the decedent’s own life, so the situs and valuation of that policy need their own analysis.
Ownership structure, premium funding, beneficiary designation, trust ownership, gift-tax rules, and the tax rules of the decedent’s home country can also change the broader result.
For that reason, life insurance should not be described as automatically “tax-free” in every cross-border setting even though the Form 706-NA situs rule for proceeds on the decedent’s life is favorable.
Allowable deductions on Form 706-NA: reducing the taxable estate
Form 706-NA permits deductions from the US gross estate, but the rules differ from those for a US citizen or domiciliary. Funeral and administration costs, claims, mortgages, marital transfers, and charitable transfers are subject to documentation requirements and, in several cases, statutory or treaty limitations.
For an NRNC estate, deductions under IRC §§2053 and 2054 are generally limited by the ratio of the US gross estate to the worldwide gross estate, which makes worldwide assets reporting relevant even though only US-situated property is subject to the estate tax.
The following 4 deduction categories are the ones most often relevant:
- Funeral and administration expenses, claims, and certain losses. Qualifying expenses and claims are reported with an itemized schedule and supporting information, subject to the statutory limitation.
- Mortgages and liens. Debt deductions, estate-tax treatment depends on the nature of the liability and the property. The estate should document the obligation and any security interest rather than subtracting debt automatically from gross value.
- Marital deduction. Unless a treaty permits another result, a marital deduction generally requires a US-citizen surviving spouse or qualifying property passing to a QDOT.
- Charitable deduction. Without treaty relief, the Form 706-NA instructions generally restrict the deduction to qualifying domestic entities or qualifying use within the United States.
The IRS instructions require the estate to state the value of assets outside the United States as part of the calculation. That worldwide inventory can therefore affect the allowable expense ratio even when those foreign assets themselves are not US situs.
Book a free discovery call
Own US shares, funds, or property and unsure whether the $60,000 estate-tax threshold affects you? A TFX discovery call can help you identify the filing issue and the information to gather before deciding what to do next.
How to avoid or minimize US estate tax as a nonresident alien
An NRNC can sometimes reduce future US estate-tax exposure by changing how US investments are held, using treaty provisions, making appropriate lifetime transfers, or addressing a noncitizen spouse through a QDOT. Each method has income-tax, gift-tax, corporate, treaty, and home-country consequences that need separate review.
The most useful US estate-tax planning for a nonresident investor usually occurs before US assets are acquired, because changing an existing structure can itself create tax, legal, financing, or transaction consequences.
The following 6 strategies commonly arise in cross-border estate planning:
- Consider foreign-company ownership of US investments. Shares of a genuine foreign corporation are generally outside US situs, even if the corporation owns US property. This structure can introduce corporate tax, FIRPTA, financing, substance, shareholder, and home-country issues, and special rules apply to certain pre-2008 expatriates.
- Compare foreign-domiciled and US-domiciled funds. An Ireland-domiciled corporate ETF is generally foreign corporate stock for US estate-tax situs purposes, while a US-domiciled ETF is generally US situs. Compare withholding, investment regulation, fund costs, residence-country tax, and investment suitability before switching.
- Use applicable treaty benefits. A nonresident alien estate tax treaty can alter situs rules, deductions, or credits. Certain treaties provide a proportionate unified credit based on US assets and the worldwide estate.
- Evaluate life insurance. Proceeds on the NRNC decedent’s own life are generally outside US situs. The policy structure, funding, beneficiaries, local inheritance rules, and any trust arrangement still need review.
- Consider lifetime gifts where appropriate. For an NRNC, US gift tax generally applies to US-situated real and tangible property, while gifts of US-situated intangible property such as ordinary US corporate stock are generally outside US gift tax under IRC §2501(a)(2), subject to special exceptions. A lifetime transfer should still be reviewed for foreign gift, capital-gains, succession, and reporting consequences.
- Use a QDOT when a noncitizen spouse is involved. A qualified domestic trust can permit a marital deduction that would otherwise be unavailable for property passing to a non-US-citizen surviving spouse, although later QDOT distributions and the surviving spouse’s death can trigger Form 706-QDT tax rules.
TFX’s guide to US tax issues when obtaining a green card for a nonresident spouse provides related context for couples whose US status may change.
Step-up in basis and inheritance: what heirs of nonresident aliens should know
Property acquired from a decedent generally receives a basis tied to its fair market value at death, subject to IRC §1014 and its exceptions. That rule can apply to property inherited from an NRNC even when the estate itself had a Form 706-NA obligation.
The step-up in basis inheritance rule can remove pre-death appreciation from the heir’s starting basis calculation, but it does not erase estate tax owed by the decedent’s estate.
For example, if inherited shares had a $100,000 adjusted basis to the decedent and a $300,000 date-of-death value, the heir’s starting basis is generally $300,000 rather than $100,000. A later sale at $320,000 would ordinarily measure gain from that new basis, subject to the facts and applicable tax rules.
There are statutory exceptions. Appreciated property transferred to the decedent within 1 year of death and then inherited back by the donor or donor’s spouse can be subject to the special carryover-basis rule in IRC §1014(e).
The basis rule and the estate-return requirement should therefore be analyzed separately rather than assuming that no Form 706-NA means no basis adjustment.
Foreign executor responsibilities for a nonresident alien estate
A foreign executor administering an NRNC estate may need to obtain an estate EIN, value US property, collect the decedent’s US and worldwide asset information, assemble probate documents, and file Form 706-NA within 9 months of death when the filing threshold is met.
The Form 706-NA instructions treat the executor, administrator, personal representative, and in some cases a person possessing the decedent’s property as responsible for the return.
The main foreign executor requirements usually include these practical tasks:
- Apply for an estate EIN on Form SS-4 when an EIN is needed for estate administration.
- Identify the decedent with an existing SSN or previously used ITIN where applicable; if the decedent has neither, the Form 706-NA instructions state that the IRS will assign an IRSN.
- Collect the will, death certificate, court appointment, valuations, prior US gift-tax returns, and other required attachments.
- Obtain fair market value support for US real estate, securities, closely held companies, and other assets.
- File Form 706-NA by the 9-month deadline or timely request the available filing extension.
TFX’s guide to Internal Revenue Service Numbers for foreign taxpayers and estates explains how an IRSN differs from an ITIN or SSN.
Late filing does not automatically make every foreign executor personally liable for the estate’s tax. Separate federal fiduciary-liability rules can create personal exposure in defined circumstances, such as paying other debts from an insolvent estate before a known federal claim, so distributions should be coordinated with the estate’s tax obligations.
File Form 706-NA with confidence
A foreign executor dealing with more than $60,000 of US-situated assets may need valuations, supporting documents, treaty analysis, and Form 706-NA within the 9-month filing window.
Before changing an investment structure, separate the estate-return problem from the longer-term ownership decision. The filing rules address a decedent’s existing estate; restructuring a living investor’s portfolio can introduce a different set of tax and legal consequences.
Frequently asked questions
The ordinary nonresident alien estate tax exemption is commonly described as $60,000. Technically, an NRNC generally receives a maximum $13,000 unified credit, equal to the tax on the first $60,000 under the unified rate schedule. A treaty can provide a different or larger benefit.
US situs assets generally include US real estate, tangible personal property physically in the United States, and stock of US corporations. Certain US debt also falls within US situs, while qualifying deposits, portfolio debt, foreign corporate shares, and life-insurance proceeds on the NRNC decedent’s own life can fall outside it.
A treaty reducing tax to $0 does not by itself answer the filing question. The estate must review the $60,000 statutory filing calculation, the treaty, and the current Form 706-NA instructions. Treaty-based positions reported on the return generally require an attached treaty statement, and particular treaties have their own procedures.
Shares of a US-domiciled ETF organized as a domestic corporation are generally US situs because domestic corporate stock is US-situated for NRNC estate tax. That means US estate tax nonresident aliens US situs assets ETFs exposure can arise once the overall filing calculation exceeds $60,000. Fund domicile should be confirmed rather than inferred solely from where the ETF trades.
Based on our client scenario at TFX: assume $500,000 of US corporate stock, no adjusted taxable gifts, no deductions, and no treaty relief. The unified schedule produces tentative tax of $155,800 at $500,000; after the ordinary $13,000 unified credit, the resulting federal estate tax is approximately $142,800.
Do not assume so. The IRS currently lists 15 countries with estate or estate-and-gift provisions, and the relevant treaty text controls the benefit. Canada is a special case because Article XXIX B of the US–Canada income tax treaty contains estate-tax provisions.
Form 706-NA is generally due 9 months after death. Form 4768 can provide an automatic 6-month extension to file when timely submitted. An extension to file does not automatically postpone the tax-payment deadline.
Foreign-corporation shares are generally outside US situs, even where the corporation owns US real estate, but that does not make the structure an automatic tax solution. Corporate tax, FIRPTA, income tax, substance, financing, home-country rules, treaty provisions, and narrow special look-through rules can change the outcome. Review the structure before transferring existing property into an entity.
Foreign nationals with broader US tax questions can also review TFX’s guide to when foreigners pay US taxes.
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