I regularly provide market updates to numerous Canadian real estate agents I network with. Each time I get responses from some who thank me for the updates, comment on their market and mine and sometimes just check in with friendly banter. The last time I sent out the update I received a response from an agent who normally responds with her own update and friendly thoughts. But this time was different. She said she was concerned about innocent Canadian buyers being smacked by the new death tax. She had a couple clients who owned property in another US market who sold because they feared a tremendous hit on their taxes. She specifically stated that they were upset because the US would tax them on all of their assets.
This fortunately is not the case, and never was. But it does show how easy it is for misinformation to spread. (Actually, a foreign national owning US property may only be taxed on the US situs property for an estate tax. But the calculation does include the overall estate for purposes of determining the estate tax that may be owed.) The unfortunate way our congress handles matters put a lot of doubt on where the estate tax would end up. Fortunately, previous laws were held up and we didn't revert to old rates.
The key point here is that there is a lot of information out there and not all of it is accurate. I performed a quick search before writing this and the vast majority of articles were older and made wide ranging suppostions about future impacts. The fact is that the majority of Canadian estates holding property in the US may never have to pay an estate tax due to the exemption limits and the US-Canada Tax Treaty. The key thing to remember is that eveyone's individual situation is different and the best way to determine your strategy is to talk with a tax specialist you trust.
But getting back to my main point; like many other things in life don't rely on the grapevine to make your decisions. Let it be a starting point and properly investigate before making decisions you may not need to make. This pertains to all aspects of life!
Adam Tarr PC
Citywide Real Estate
Comments(0)