US Estate Tax for non-American owners of US assets
26 May 2025 •
What happens if you die with US assets in your estate as a non-American? It may feel intimidating as a UK executor if you are administering an estate containing US assets. In this article we highlight the US Estate Tax exposure and administrative forms required in this situation.
US Estate Tax for US domiciliaries
If you’re a US domiciliary, which includes US citizens and Green Card Holders, you’re subject to US estate and gift taxation at up to 40%. You are, however, entitled to a substantial lifetime gift and Estate Tax exclusion. This is currently $12.92million, projected to fall to $5million (indexed for inflation) in 2026. If you’re a non-US citizen, your US domicile status is determined by both intentions and actions.
US Estate Tax for non-US domiciliaries
If you’re a non-US domiciliary, you’re subject to US estate and gift taxation on certain types of US assets at up to 40%. However, your exemption at only $60,000 is much lower than that of US domiciliaries. This exception is not indexed for inflation and the exemption is only available for transfers at death.
Because the non-US domiciliary exemption is much lower than for a US domiciliary, many people with US assets could be within the scope of US estate and gift tax.
As a non-US domiciliary, you’re taxed on the value of your US situs assets. Here are some of the most common US assets subject to US Estate Tax:
US situs real estate property
Shares in US corporations
Tangible personal property
Interests in partnerships that do business in the US
Partnerships or trusts that own US situs assets
Bank accounts connected to a US trade or business (but not personal bank accounts)
US pension plans such as IRAs or 401ks
US Estate Tax relief and exemptions
It’s possible to be domiciled in more than one country. Where this is the case, there may be an Estate Tax treaty that can be relied upon to reduce US Estate Tax exposure, or at least prevent double Estate Tax exposure. Relief may also be available for any US Estate Tax paid as a credit against the Estate Tax of other country.