Advantages Jamaican Owned Florida Trust
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These are original documents we\'ve been developing over the past year to educate Realtors, US Investors, Foreign Investors, distressed home owners and Retiring Baby Boomers. You can see the video versions at either facebook.com/celticwindinvestment or on youtube at youtube.com/mikenweston/.
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Advantages Jamaican Owned Florida Trust
- 1. Tax Issues Florida Land Trust Offers unique tax Risk reductions Presented by Nicola Chin And Michael Belgeri
- 2. ESTATE TAX CONCERNS #1
- 3. ESTATE TAX CONCERNS #2
- 4. ESTATE TAX CONCERNS #3
Editor's Notes
- Estate taxes are often of paramount concern when Jamaicans own property in the U.S. Under the present tax treaty Jamaicans are taxed in the United States upon U.S. Law. Gains on sales of US real property are taxable regardless of the residency status of the investor. Nonresident aliens, however, may have fewer opportunities to defer capital gains (for example, through such techniques as like-kind exchanges or corporate reorganization) than residents or citizens. As a result, if title is held in an individual name and the worldwide assets exceed the present exemption amount, the surviving spouse may be hit with a significant estate tax that starts at 26% and climbs all the way to 45% based on the value of the estate. If properly drafted, shares within the land trust do not need to be revealed until the time of death thereby making it possible to legally and artfully manipulate the reported property interest of the deceased and hopefully avoid estate tax.
- Jamaican inheritance laws always apply to the personal property of a deceased person who had permanent residence in Jamaica. When property is involved the gift tax is 7.5%. However, Jamaica is a tax treaty country and, as a result, the US Gift tax law would apply here. If the deceased had a permanent home elsewhere, the law of the deceased’s permanent home applies to personal property as well. Another tool to avoid or minimize estate tax is to make children beneficiaries at the time of purchase thereby increasing the tax exemption amount by increasing the number of individuals possessing an interest in the land trust. There is no gift tax in Jamaica for property or value gifted in the United States.. If the funds are gifted to the children in Jamaica and transferred for closing here is no taxable event. However, if the property is located in the United States, a subsequent transfer of property to children will trigger a gift tax owed to the U.S.
- Yet another technique to reduce exposure to the U.S. estate tax is to split interest ownership within the Land Trust. Under such an arrangement, an individual may acquire a “life” interest in the land trust. This interest expires at death. His heirs would acquire the remainder interest in the property under successor rules, and, by the way, without probate. Upon the death of the individual, there would be no estate tax on the life interest, since the life interest would have no value upon death. However one caveat: Should the children die while holding a remainder interest, the estate tax would be assessed on the value of the remainder interest. As a practical matter, children can obtain term life insurance at lower costs (due to their age) to protect them from estate tax exposure.