Correction - A non US citizen Saudi Arabian estate tax

Gary Gauvin, my old tax partner in Ottawa has also sent a correction to my
Saudi Arabia estate question.  Again, I was not thinking.  Saudi, grand
Cayman, Bahamian, etc citizens are still only given the exemption that
Canadians received up to November 1988 before the 1995 treaty was changed
retroactively.
Thanks Gary
david
-----Original Message-----
From: Gary P Gauvin [mailto:tax at garygauvin.com]
Sent: Friday, January 07, 2005 8:32 AM
To: taxman at centa.com; centapede at lists.centa.com
Subject: RE:  A non US citizen Saudi Arabian estate tax -
ask a cross border international business valuator valuation appraisal
appraiser david ingram income tax and immigration expert
Hi David.
Only when there is a treaty rate available do nonresidents of the US get the
full 1,500,000 exemption for estates.
Saudi residents and most others only get a unified tax credit of $13,000.
That equates to an exemption of $60,000. Nonresidents are allowed to use the
alternative valuation date like citizens.
Also, every state has different rules for their state estate tax.
Regards;
Gary
Gary P Gauvin LLC
Tax Services
2500 Rochelle Rd
Rockwall TX 75032
Phone & Fax (469) 273-3399
tax at garygauvin.com
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-----Original Message-----
From: centapede-bounces at lists.centa.com
[mailto:centapede-bounces at lists.centa.com] On Behalf Of
centapede at lists.centa.com
Sent: Friday, January 07, 2005 12:53 AM
To: CENTAPEDE
Cc: Webmaster at Jurock. Com
Subject:  A non US citizen Saudi Arabian estate tax - ask a
cross border international business valuator valuation appraisal appraiser
david ingram income tax and immigration expert
QUESTION:
What are the rulles for a Saudi diplomat who passed away in the US leaving
three properties included in a will divided between a wife and two childern
(adults). Do they have to file for estate tax? if the answer is yes what
kind of percentage?
Thank You
I can also be reached @ 703 xxx-xxxx
===============================
david ingram replies:
Diplomats stationed in the US are generally exempt from any form of US
taxation with the exception of tax on rentals and tax on Dividends.
In general, a Diplomat is considered a non-resident and not taxed on earned
income.
However, a Diplomat who is a non-resident who has investment property would
be taxable for estate purposes as any other non-resident would be.
The exemption for 2004 was $1,500,000 After that, the rates rise from a low
of 18% to a high of 55% of the estate.  Since his wife is not a US citizen,
she does not get the benefit of unlimited tax free rollovers to her.
You need to consult an estate person in the city or state where the property
is located to determine the estate tax liability.
My associate, George Arora is a CPA, MBA with a Masters of Taxation as well.
However, dealing with us in this situation makes no sense to me.
The estate exemption is to rise to $3,500,000 by 2009 and be eliminated in
2010 but that does you no good at this time.
The following table shows the rates of Estate Tax:
The following rates of gift and estate tax apply:
Column A		Column B			Column C
Column D
Rates of Tax
Taxable		Taxable			Tax on 			on excess
Amount
amount		amount in			over amount
			excess
--			10,000			----
18%
10,000		20,000			1,800				20%
20,000		40,000			3,800				22%
40,000		60,000			8,200				20%
60,000		80,000			13,000			26%
80,000		100,000			18,200			28%
100,000		150,000			23,800			30%
150,000		250,000			38,800			32%
250,000		500,000			70,800			34%
500,000		750,000			155,800			37%
750,000		1,000,000			248,300			39%
1,000,000		1,250,000			345,800
41%
1,250,000		1,500,000			448,300
43%
1,500,000		2,000,000			555,800
45%
2,000,000		2,500,000			780,800
49%
2,500,000		3,000,000			1,025,800
53%
3,000,000		10,000,000			1,290,800
55%
10,000,000		21,040,000			5,140,800
60%
21,040,000	----					11,764,800
55%
 The formatting above may not be correct.  However you can find the original
by going to www.centa.com and clicking on US / Canada Income Tax on the
right hand side.
Note that the exemptions in the reference above have not been changed.
I also welcome any comments from other members of this list who may have
some insight that I have missed.
So stay tuned.  I have added your name as well and if any of our other
experts have a contradictory opinion, they will let me know.
This from "ask an income tax and immigration expert" from www.centa.com
<http://www.centa.com/>  or www.jurock.com <http://www.jurock.com/>  or
www.featureweb.com <http://www.featureweb.com/> . David Ingram deals on a
daily basis with expatriate tax returns with:
multi jurisdictional cross and trans border expatriate problems  for the
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GB, and any of the 43 states with state tax returns, etc. Rockwall, Dallas,
San Antonio and Houston Texas Denmark, Finland, Sweden Norway Bulgaria
Croatia Income Tax and Immigration Tips, Income Tax and ImmigrationWizard
Income Tax and Immigration Guru Income Tax and Immigration Consultant Income
Tax  and Immigration Specialist Section 216(4) 216(1) NR6 NR-6 NR 6
Non-Resident Real Estate tax specialist expert preparer consultant
expatriate anti money laundering money seasoning FINTRAC E677 E667 4789 4790
TDF-90 Reporting $10,000 cross border transactions =========================
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David Ingram's US/Canada Services
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Res (604) 980-3578 Cell (604) 657-8451
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