Gift Tax

In the US, essentially gifts of US property are subject to gift taxes.  Any gift of US property to a non-US spouse in excess of $159,000.00/year (2021), is subject to gift taxes at a rate as high as 40%. Any gifts to anyone other than a spouse greater than $15,000/year (2021) is subject to gift taxes.

The typical scenario is for one spouse to bring his/her money into the US, purchase real property and then place his/her spouse’s, and/ or children’s names on the deed to the property.  At the moment the deed vests, a gift has occurred. While the annual exclusion of $159,000 (2021) to a non-US spouse minimizes the gift tax, the Tax Treaty does not shelter gifts to children in excess of $15,000 (2021). Improper planning of the annual exemptions under the US gift tax scheme often cause negative US income taxes.

We help Canadians with planning before funds are brought to the US to eliminate US gift exposure while maximizing US income tax savings.

US Income, Gift, and Estate Tax Planning
Income Tax – Gain on Sale of Real Property
Foreign Investment in Real Property Tax Act (FIRPTA)
Estate Tax
Income Tax – Rental income in the US

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