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What is dual citizenship and why might it be important for estate planning purposes? Dual citizenship occurs when a person holds citizenship in two countries simultaneously. There are a number of ways that dual citizenship can come about, including birth, marriage, Naturalization, or descent from dual citizens. Dual citizenship can be important for estate planning […]
November 1, 2022 ★ 

What is dual citizenship and why might it be important for estate planning purposes?

Dual citizenship occurs when a person holds citizenship in two countries simultaneously. There are a number of ways that dual citizenship can come about, including birth, marriage, Naturalization, or descent from dual citizens. Dual citizenship can be important for estate planning purposes for a number of reasons. First, dual citizenship can provide access to additional benefits, such as healthcare and education. Second, dual citizenship can provide protection in the event that one of the countries rescinds the person's citizenship. Finally, dual citizenship can provide a measure of financial stability in the event that one of the countries experiences economic upheaval. As a result, dual citizenship can be an important consideration for those engaged in estate planning.

How does dual citizenship impact an individual's estate plan and what should be considered when creating one?

Dual citizenship can have a significant impact on an individual's estate plan. For one thing, it can complicate the distribution of assets after death. If an individual holds citizenship in two countries, their estate may be subject to the laws of both countries. This can make it difficult to determine how best to distribute their assets. Furthermore, dual citizenship can also complicate the process of probate. In some cases, an individual's estate may need to be Probated in both countries. This can add significant time and expense to the process. As a result, it is important to consult with an experienced estate planning attorney when creating an estate plan if you hold dual citizenship.

What are some of the benefits of having a dual citizenship estate plan in place?

Estate planning is an important process for everyone, but it can be especially complex for those with dual citizenship. A dual estate plan can help to ensure that your assets are distributed according to your wishes, regardless of which country you are living in at the time of your death. It can also help to minimize estate taxes and avoid probate delays. In addition, a dual estate plan can provide peace of mind for you and your family by ensuring that your affairs are in order. If you are a dual citizen, estate planning is an essential part of ensuring that your assets are protected and your wishes are respected.

How can individuals with dual citizenships ensure that their estate plans are executed properly after their death?

When an individual with dual citizenship dies, their estate may be subject to the laws of both countries. This can complicate the process of estate planning and make it difficult to ensure that the individual's wishes are carried out properly. There are a few steps that individuals with dual citizenship can take to make sure that their estate plans are executed correctly.

First, they should consult with an attorney who is familiar with the laws of both countries.

Second, they should create separate wills for each country, specifying which country's laws should apply to their estate.

Finally, they should keep all of their important documents, such as birth certificates and passports, in one place so that they can be easily located after the individual's death. By taking these steps, individuals with dual citizenship can help to ensure that their estate plans are carried out correctly.

Estate Laws Vary in Countries Around the World

The United States, Canada (but not necessarily Quebec), and the United Kingdom all have a common legal heritage based on English common law. This allows for more flexibility when determining how assets and property will be passed on to heirs and beneficiaries. In these types of countries, an individual can draft a Last Will and Testament or, better because of privacy, incapacity planning, annexation avoidance reasons, etc., a Revocable Living Trust that specifies who will receive their property/accounts and in what proportions. In common law countries such as these, an individual typically designates an executor or trustee to distribute their assets after death in accordance with state laws and probate court procedures (or, if planned for using a Revocable Living Trust, without going through the probate process entirely). 

In countries like central and South America, as well as many European nations, the inheritance laws are based on civil law rather than English common law. Civil law - also known as Napoleonic or Roman law - can be quite inflexible, longer, and more involved. The legal principles that determine who can inherit property, and the degree of freedom an individual has to alter inheritance rules vary drastically from place to place. Middle Eastern countries usually follow Muslim inheritance laws. African and Asian countries may have a mix of local customary laws, civil law, and even English common law elements depending on the country’s origin.

Passing Property to Heirs

If you're a dual citizen and plan on owning property in multiple countries, it's integral that you understand the varying laws regarding distributing your assets when you pass away. These laws can often lead to results counter to what was originally intended. Countries such as the United States, United Kingdom, and Canada usually have much more flexible policies when it comes an individual’s right to choose who inherit their belongings after death., This is because these countries share a similar legal foundation rooted in English common law. In countries that follow common law, an individual can usually draft a last will and testament. This document determines who will receive the individual's property and in what proportions after they die. The individual can also typically name someone to be in charge of their final affairs.

However, the legal principles surrounding inheritance vary widely in the Western world, with some countries allowing individuals more freedom to alter the default inheritance rules. Many countries' inheritance laws originate from Roman law, which can be extremely inflexible and specific when it comes to property distribution. This particular branch is commonly known as Napoleonic or civil law. On the other hand, Muslim inheritance law governs Middle Eastern nations, while a combination of local customary law (which varies depending on the country), civil law, and even English common law oversees African and Asian countries--this last one due largely in part to Western colonization's lasting effects on these continents.

If 2 US citizens owned a lot of property in Greece and only did their estate planning under California law, their relatives could be very unhappy when they tried to get their house in Greece. Parts of their estate plan that show what they wanted to happen to their Greek home might not mean anything according to Greek law, and somebody they never wanted to inherit might get it instead.

If you are a US citizen with dual citizenship, you must be prepared to consider many complex legal issues relating to death. This is especially true if you own property in one or both countries. US citizens should speak to a lawyer in each country where they have citizenship since inheritance laws vary by nation. The right attorney will know the exact statutes, treaties, and local directives that apply to your case and help you figure out the best way forward based on your wishes.

Transfer, Estate and Inheritance Taxes

The tax implications of transferring property ownership may be different for a U.S. citizen with dual citizenship, depending on the location of the property, what type of property it is, whether there are any tax breaks between the two countries involved, and if there are any transfer-of-ownership treaties in place between the U.S. and another country. Currently, the U.S. has estate or gift tax treaties with sixteen sovereign nations. By having these treaties in place, you can avoid potential double taxation on your assets and save money on inheritance taxes. These treaties can safeguard U.S. citizens from double taxation or discriminatory tax treatment. Not only can treaties make the process more orderly and fair, but in countries where transfer tax treaties have not been established, there is much less clarity about how a dual citizen’s property will be taxed for inheritance. For example, the U.S. and Canada have a bilateral tax treaty--something that will be an important factor to consider when developing a dual citizen's estate plan.

A Living Trust for People With Dual Citizenship

If you want to avoid inheritance tax in the U.S., don't assume that putting your property in a living trust will work. More often than not, trusts are ineffective when owners move between countries. In fact, holding property in a trust may result in higher taxation from another country's government. Instead, it's often best to keep your property in your own name to avoid any potential complications with foreign inheritance laws.

If you're a US citizen and have only ever lived in the States, you might believe that forming a revocable living trust will protect your property during inheritance--but this is often not the case for international purposes. Although it is not common, living trusts in the USA can be used for estate planning in other countries. However, owning property through a living trust may have negative tax repercussions. If, for example, a US citizen who owns property moves to the United Kingdom, the government there may assess capital gain taxes on any assets in the trust that have increased in value. A similar thing could happen if a US Citizen moved to Canada with a trust.

When it comes to estate planning for dual citizens, there is no one-size-fits-all solution. Every individual's situation is unique, and must be taken into account when crafting an estate plan. However, by working with a qualified attorney who is familiar with the laws of both countries involved, you can ensure that your assets are protected and that your loved ones are taken care of according to your wishes.

International estate planning for dual citizens can be a complex process, and it is important to consider all of the factors involved, in order to ensure that your assets are protected and your loved ones are taken care of according to your wishes. If you have dual citizenship, it is essential to work with a qualified attorney who is familiar with the laws of both countries involved, in order to create an estate plan that meets your specific needs.

If you are located in New Jersey and have dual citizenship, book a call with attorney Benjamin Eckman today to discuss what options are available to you, and make sure that your estate is properly planned for.

Law Firm of Benjamin Eckman
Planning Today for Your Family's Tomorrow

1767 Morris Ave., Suite 314
Union, NJ 07083

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73 Mt. View Blvd.,
Wayne, NJ 07470

1 University Drive, Suite 609
Hackensack, NJ 07601

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1767 Morris Ave., Suite 314
Union, NJ 07083

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Wayne Office

By Appointment Only:

73 Mt. View Blvd.,
Wayne, NJ 07470

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Hackensack Office

1 University Drive, Suite 609
Hackensack, NJ 07601

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