Posted: July 1st, 2015

International Tax and Estate Planning Discussion Post 3

Please compose a response to the discussion prompt below.

Nancy and Richard had been married for 9 years. Richard recently passed away survived by Nancy and their two minor children. Richard and their two children are US citizens but Nancy kept her Canadian citizenship. The family has lived in the US for the last seven years.
Nancy sought your help to settle Richards estate. Earlier this year Richard gave Nancy a $35,000 diamond ring and necklace to celebrate their wedding anniversary. Nancy inherited a rental property from her parents last year. She decided to upgrade the property before renting it to another tenant. Richard loaned Nancy $50,000 to pay for the renovation. The rental property is Nancys separate property. Prior to the loan, they made sure to prepare a written loan contract for the renovation cost.
Last year, Richard and Nancy established a trust for their family. Nancy seeks your help to understand the potential tax consequences of Richards death to their family assets. In his will, Richard also gave a gift of $30,000 to her only sister, Michelle, to help her build her new medical practice. The trust was primarily intended to take care of Nancy and their children and she wants to make sure that the trust continues to meet this goal after Richards death.
Will your advice to Nancy change if she is a US citizen?