International Estate Considerations Flashcards
7 cards from real CEA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 International Estate Considerations flashcards as text
A client has dual US-Italian citizenship and dies domiciled in Italy. Which country has primary jurisdiction over the client's personal property for succession purposes?
Answer: Italy, because the client was domiciled there at death
For movable personal property, most countries (including Italy under EU Succession Regulation 650/2012) apply the law of the decedent's domicile at death.
What is an 'apostille' and why is it important in international estate administration?
Answer: A certificate that authenticates a public document for use in a foreign country under the Hague Convention
An apostille is an international certification under the 1961 Hague Convention that authenticates the origin of a public document so it is accepted in other signatory countries.
A US advisor discovers that a client's estate includes a foreign pension plan in Australia. How is a distribution from this plan to a US beneficiary generally treated for US income tax?
Answer: Potentially taxable as ordinary income, depending on the US-Australia tax treaty provisions
Foreign pension distributions to US beneficiaries are generally taxable as ordinary income, though treaty provisions may provide partial exclusions or reduced rates.
Which principle in private international law determines the choice of law for succession of immovable (real) property across borders?
Answer: Lex situs — the law of the place where the property is located
Under the lex situs principle, succession to immovable property is governed by the law of the jurisdiction where the property is physically located.
A non-US domiciliary dies leaving a will that was validly executed under the laws of their home country. For US probate purposes, what must typically occur for the will to be recognized?
Answer: The will must be 'proven' or 'authenticated' in a US probate court, often through ancillary probate
Foreign wills are not automatically recognized in US courts; they must be submitted to ancillary probate proceedings in the relevant US state to transfer US-situs assets.
A wealthy foreign national wants to gift US real estate to their US grandchildren without triggering estate tax. Which strategy should an estate advisor evaluate FIRST?
Answer: Transfer the property to a foreign LLC before gifting interests to grandchildren
Transferring US real property to a foreign LLC first may convert the US-situs asset into foreign-situs intangible property (LLC interests), potentially reducing gift and estate tax exposure.
Under IRC Section 2801, a US person who receives a 'covered gift or bequest' from a covered expatriate must pay a tax equal to what rate?
Answer: The highest applicable gift tax rate in effect at the time of receipt
IRC Section 2801 imposes a tax on the US recipient at the highest gift or estate tax rate in effect (currently 40%) on covered gifts and bequests from covered expatriates.