Dual U.S. citizenship creates unique estate planning challenges, especially if a non-U.S. spouse and children are involved.- This blog briefly addresses dual citizenship and estate planning in New Jersey.
The United States allows dual citizenship. Dual citizenship means that a person can be a citizen of the United States and another country at the same time. The U.S. government does not require U.S. citizens to give up their citizenship in their country of origin.
How does dual citizenship work in the U.S.?
- S. citizens must obey the laws of both countries, including estate planning.
- S. citizens may face differing tax rules and other restrictions or protections while abroad, especially in the country of their other nationality.
Dual citizenship and other countries
- Not all countries allow dual citizenship, nor recognize the laws of the other country. For example, China and India may not recognize a person’s status as a naturalized American.
- Some countries permit a person to acquire foreign citizenship by marriage, such as the United States, but require that the immigration process be followed.
What are some of the disadvantages of dual citizenship when it comes to estate planning in New Jersey?
Dual citizenship can have several disadvantages, including tax, legal, and other related issues.
Taxation
- Double taxation: You may be taxed on your income in both countries and/or have estate tax issues involving your spouse.
- Complex tax laws: The tax laws of each country can be complicated.
Legal
- Conflicting laws: Laws in one country may conflict with laws in another. This topic is addressed below.
Dual citizens should create separate wills for each country to ensure, at a minimum, that the assets of each country will be distributed in accordance with their intentions. Trusts can and must be considered when a U.S. citizen is an intended beneficiary of the estate.
To discuss your NJ estate planning matter, please contact Fredrick P. Niemann, Esq. at (732) 863-9900 or email him at fniemann@hnlawfirm.com. Please ask us about our video conferencing or telephone consultations if you are unable to come to our office.
By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold Township, Monmouth County, NJ Estate Planning Attorney