In a recent online edition of Private Wealth, Beth Tractenberg and Kathryn Von Matthiessen discuss the nexus between people from a foreign nation living in the U.S. and the current Gift Tax exemption. The authors first break down the difference between foreigners Domiciled in the U.S. versus those that are not domiciled here (Non-Doms). U.S. courts have a factoring system when it comes to determining whether a person is domiciled in the U.S. If it is determined that a foreigner is domiciled in the U.S., U.S. gift taxes generally apply to that person. Previously, there was a $1 million cap on the amount a person could gift during his or her lifetime. This new reform ups that amount to a $5 million exemption for each person, therefore giving a couple a $10 million exemption. Also, it is VERY IMPORTANT to note that this exemption will only be in effect until the end of 2012. There is also a real possibility that Congress could end this extra exemption early so it is important not to wait to long if a significant give is something you are considering as part of your Florida Estate Planning
There are three types of people this blog is meant to inform: U.S. citizens, Domiciled foreigners, and Non-Domiciled foreigners. U.S. citizens can take advantage of the laws of their nation. However, it is the non-resident Domiciled and Non-Domiciled person who may not know their wealth can be protected from U.S. taxes in that the new exemption applies to them. If you do not know whether you are a Domiciled or Non-Domiciled foreigner, you should contact a Jacksonville Estate Planning attorney so they he or she can guide you to make a sound decision on keeping the money you have worked hard to earn before the exemption end at the end of 2012.