Interesting article highlights the difference between U.S. and Canadian “death taxes” (or lack thereof).
While President Barack Obama’s new tax proposals may never see the light of day, given the Republican majorities in both the House and Senate, they have generated discussion among cross-border tax practitioners. Dual citizens living in Canada or Canadians who own U.S. properties may wonder whether they need to reopen their estate plans in case the proposals, referred to by the White House as an attempt to close the “trust-fund loophole,” ever come into law.
Canada and the U.S. have historically taken quite a different approach to taxation upon death. In Canada, there is a deemed disposition at fair market value of all your capital property (other than your principal residence), as of the date of death and you pay capital-gains tax on any accrued gains on your final tax return.
The U.S., however, has an estate tax that taxes the fair market value of a U.S. person’s estate above…
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