Just a few decades ago, marrying someone from another country was not common in the United States. Times have changed though and international marriages are far more common than they once were. If you are in an international marriage, there are some practical considerations that you should address that you may not have thought of, chief among them your estate plan.
The number of international marriages has doubled in the U.S. in the last 50 years. There were over five million Americans married to a foreign national in the U.S. in 2010 and the number is expected to grow in the near future. The globalization of the marketplace has led to Americans spending more time abroad in recent years. That, in turn, has resulted in an increase of love affairs and marriages between people from different countries. Although your love may know no borders, tax laws still do.
To ensure that your spouse is provided for in the event of your death, you may need to revise your estate plan if you enter into an international marriage. Most people, for example, count on the unlimited marital deduction to be able to pass their entire estate, tax-free, to a spouse upon death. What many people do not realize, however, is that the unlimited marital deduction only applies if both spouses are U.S. citizens. Your foreign national spouse does not get the assets tax-free. Therefore, if your estate value exceeds the lifetime estate and gift tax exemption amount, your spouse’s gift could be taxed at up to 40 percent.
Be sure to consult with your estate planning attorney if you are part of an international marriage to ensure that your spouse is provided for as you wish him or her to be.
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