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Cardinal Point Wealth Management Warns Canadian Residents About U.S. Estate Taxes

By: Get News
Navigating U.S. Estate Tax Risks for Canadian Residents with U.S. Assets

Cardinal Point Wealth Management, a leading firm specializing in cross-border estate planning, is alerting high-net-worth Canadian residents who are not U.S. citizens about potential U.S. estate tax implications. While it is common knowledge that Canada does not impose an estate tax on a deceased individual’s assets, many Canadian residents may be unaware that they could still face U.S. estate taxes.

U.S. Estate Tax Exposure for Canadian Residents

Canadian residents who are not U.S. persons (i.e., U.S. citizens or green card holders) could be subject to U.S. estate tax if they hold what is referred to as U.S. situs property. U.S. situs property includes U.S.-based assets such as real estate, shares in U.S. corporations (like Apple Inc.), and even U.S. investments held in Canadian accounts, including registered retirement savings plans (RRSPs) or tax-free savings accounts (TFSAs). If a Canadian resident’s worldwide estate exceeds a certain threshold at the time of their death, they could be liable for U.S. estate taxes on their U.S. assets.

Kris Rossignoli, Cross-Border Tax and Financial Planner at Cardinal Point Wealth Management, explains, “Many Canadians don’t realize that owning U.S. assets can expose them to U.S. estate tax, even if they’re not U.S. citizens. Proper cross-border estate planning is essential to avoid significant tax burdens on their estates.”

Filing Requirements for U.S. Estate Taxes

The U.S. estate tax filing requirements add another layer of complexity for Canadian residents. A U.S. estate tax return must be filed with the Internal Revenue Service (IRS) if a deceased Canadian resident holds U.S. assets valued over USD 60,000 at the time of death. This is required even if the Canada-U.S. Tax Treaty ultimately eliminates the estate’s tax liability by applying credits.

Rossignoli further explains, “Although the Canada-U.S. Tax Treaty offers relief, Canadians need to file Form 706-NA to claim their treaty benefits and ensure their heirs avoid double taxation. Filing this form is critical to establishing a stepped-up basis for U.S. assets, which adjusts the asset’s tax value to its fair market value at the time of death.”

Without filing Form 706-NA, beneficiaries may inherit U.S. assets with a zero basis, which could result in significant double taxation when the assets are sold or transferred.

Comprehensive Cross-Border Estate Planning

Cardinal Point Wealth Management highlights the need for Canadian residents to approach estate tax exposure comprehensively. It’s important to consider U.S. estate taxes and the potential impact of income tax, gift tax, and probate tax on an estate’s worldwide assets. These complexities underscore the value of professional cross-border estate planning.

“It’s not just about U.S. estate taxes,” says Rossignoli. “Other tax considerations—such as income tax and probate taxes—may apply depending on the jurisdiction and the type of assets held. Consulting with a cross-border advisor can help individuals understand their options and plan effectively.”

Do U.S. Estate Taxes Apply

Understanding U.S. estate tax exposure is vital for Canadian residents with U.S. assets. Cardinal Point Wealth Management encourages individuals to speak with a financial advisor to assess their situation and explore planning opportunities.

Rossignoli emphasizes, “If your estate includes U.S. assets, or if the total value of your estate exceeds the thresholds set by U.S. tax laws, it’s critical to engage in cross-border estate planning to protect your beneficiaries from unexpected tax liabilities.”

About Cardinal Point Wealth Management

Cardinal Point Wealth Management is a leading cross-border financial and estate planning service provider. Specializing in Canada U.S. financial planning, the firm assists clients in navigating the complex tax, legal, and financial challenges that arise from holding assets in both Canada and the U.S. Through personalized, strategic planning, Cardinal Point helps clients preserve their wealth and minimize tax liabilities across borders.

Disclaimer: This press release may contain forward-looking statements. Forward-looking statements describe future expectations, plans, results, or strategies (including product offerings, regulatory plans and business plans) and may change without notice. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements.

Media Contact
Company Name: Cardinal Point Wealth Management
Contact Person: Kris Rossignoli
Email: Send Email
Phone: 8662132036
Address:2255 Glades Road, Suite 324A
City: Boca Raton
State: FL 33431
Country: United States
Website: https://cardinalpointwealth.com/



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