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Preparing Form 706-NA: Estate and Gift Tax Treaties, U.S. Situs Assets, Allowable Deductions, Transfer Certificates

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, June 8, 2022

Recorded event now available

or call 1-800-926-7926

This webinar will explain how to prepare Form 706-NA, U.S. Estate and GST Tax Return, for green card holders and nonresidents. Our panel of trust and estate tax experts will discuss assets that are included in the gross estate, available deductions, and the effect of death tax treaties on the taxable estate, as well as demonstrate how to complete the form itself.

Description

Like U.S. residents, the estate of a nonresident alien (NRA) is valued as of date of death or using the alternative valuation date (six months later), an exemption is applied, and certain deductions are allowed before calculating the taxable estate. NRAs are also required to report the basis of assets transferred to beneficiaries using Form 8971. Unlike residents and citizens, the exemption applied is incredibly small--$60,000 compared with a resident's exemption of $12,060,000 (2022)--making planning critical for these taxpayers.

The form itself can be deceiving. It is simply two pages and three parts. The number of required attachments and additional considerations increase the complexity of these filings. Determining which assets have U.S. situs and are included in the estate is tricky. Stock in a U.S. corporation is considered located in the U.S. when owned by a nonresident. Certain countries have estate and gift tax treaties with the U.S. The executor of the estate of an NRA from a treaty-based country must examine the applicable treaty to avoid double taxation and to determine which country has taxing rights. Trust and estate professionals working with multinational taxpayers need to understand how estates of individuals located outside the U.S. are taxed.

Listen as our panel of international estate tax experts explains the preparation of Form 706-NA and its other required forms, schedules, and attachments for nonresidents.

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Outline

  1. Filing requirements
  2. Determining the gross estate
  3. Deductions and the allowed exemption
  4. Death tax treaties
  5. Preparing Form 706-NA
  6. Additional schedules
  7. Form 8971
  8. Closing letter
  9. Obtaining and filing Form 5173, Transfer Certificate
  10. Planning to reduce the taxable estate

Benefits

The panel will review these and other critical issues:

  • How U.S. estate and gift tax treaties affect the determination of the taxable estate of an NRA
  • How a nonresident obtains and files Form 5173, Transfer Certificate
  • What assets are included in the gross estate of an NRA
  • What deductions can be taken on Form 706-NA

Faculty

Bridgers, Griffin
Griffin H. Bridgers
Member
Hutchins & Associates

Mr. Bridgers' practice encompasses all areas of private wealth and family business. In addition to estate...  |  Read More

Brittain, Cindy
Cynthia D. Brittain
Partner
Karlin & Peebles

Ms. Brittain serves as a trusted counsel to high-net-worth families in the United States and abroad to implement...  |  Read More

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