Expat Community > France

Brunello
Joined 2022
Posts: 2

Inheritance Tax - US Expats

5 months ago

Hello, I have a question/concern re this topic. Let's say we have a US citizen retiree, who is a french tax resident with US$ 8 million in US financial assets, IRA's and investments, and owns no real estate in either the US or France. Our retiree passes away and at that time has spent 6 of the last 10 years as a resident of France, he/she spouse was pre-deceased. Retiree has US citizen children designated as heirs.
I believe it is clear that France would tax the estate assets, the estate exemption from french tax for children is EUR 100,000, after which the estate is taxed up to the top marginal rate of 45%. The amount of french tax is creditable as an allowance against any US taxes to the estate.
The US unified credit of $13.1 million would result in no US estate tax.

Question: If retiree estate pays tax to France, and no tax is due in the US, it seems the allowable credit has no value. The estate is taxed up to 45% in France, there is an allowable credit that can't be used, and that's the price of being a french tax resident with a significant US estate.
Is there anything I am missing here?
Thank you

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