ESTATE PLANNING
Planning for
Foreign Nationals
OLA 2026 0311
For producer use only. Not for client presentation.
This material was not intended or written to be used, and cannot be used,
to avoid penalties imposed under the Internal Revenue Code. This material
was written to support the promotion or marketing of the products, services,
and/or concepts addressed in this material. Anyone to whom this material is
promoted, marketed, or recommended should consult with and rely solely on
their own independent advisors regarding their particular situation and the
concepts presented here.
For producer use only. Not for client presentation.
Importance of Estate Planning
for Foreign Individuals
 Expanding global economy
 Need for planning
 Impact of U.S. transfer taxes
For producer use only. Not for client presentation.
Breadth of the Market
Metropolitan Area
% of Population that is
Foreign Born
Total U.SA
12.4%
Miami-Fort Lauderdale-Pompano Beach, FL
36.9%
Dallas-Fort Worth-Arlington, TX
17.7%
San Diego-Carlsbad-San Marcos, CA
23.0%
Los Angeles-Long Beach-Santa Ana, CA
34.6%
Source: U.S. Census Bureau, 2005-2007 American Community Survey
The foreign-born population includes anyone who was not a U.S. citizen or a U.S. national at birth.
This includes respondents who indicated they were a U.S. citizen by naturalization or not a U.S. citizen.
(U.S. Census Bureau, American Community Survey 2007 Subject Definitions).
For producer use only. Not for client presentation.
Introduction to the Market
Non-U.S. citizens fall into
2 categories:
Resident Aliens
Non-Resident Aliens
For producer use only. Not for client presentation.
Resident Aliens
 Non-U.S. citizen with
permanent U.S. home
 Worldwide assets subject
to U.S. estate and gift tax
 Deprived of certain tax
advantages available to
U.S. citizens
For producer use only. Not for client presentation.
Non-Resident Aliens
Only U.S. assets subject
to U.S. estate and gift tax
Non-U.S. citizen with
permanent home in
another country
For producer use only. Not for client presentation.
Estate Tax Comparison: RA vs. NRA
Resident Alien (RA)
Non-Resident Alien (NRA)
Lifetime estate
tax exemption
$5,000,000
$60,000
Estate tax rate
35% top tax rate
35% top tax rate
Unlimited
marital deduction
Only if inherited
assets are transferred to
QDOT
Only if inherited
assets are transferred to
QDOT
All worldwide assets
U.S. sitused properties,
including most
intangible properties*
Assets subject
to U.S. estate taxes
* Intangible property includes stock in a U.S. corporation and interest in a U.S. partnership
For producer use only. Not for client presentation.
Ideal Candidates
Non-Resident Aliens with
significant U.S.-based assets
Married couples consisting of
at least one non-U.S. citizen
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Sorting Out Citizenship and
Residency Status
Are you and your spouse
U.S. citizens?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Sorting Out Citizenship and
Residency Status
Do you own a home
in the U.S.?
Do you own a home in
another country?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Sorting Out Citizenship and
Residency Status
How much time do
you spend in this country
versus that country?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Sorting Out Citizenship and
Residency Status
Where are your friends and
family located?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Sorting Out Citizenship and
Residency Status
What is your
immigration status?
Green card?
For producer use only. Not for client presentation.
NRA with Significant U.S. Assets
Elaine Chen
 Taiwanese national & NRA
 Widowed
 $10,000,000 in U.S. based
real estate and investments
What is Elaine’s exposure to
U.S. estate and gift tax?
For producer use only. Not for client presentation.
Why Planning Is Important: NRAs
Elaine Chen, Taiwanese national, Nonresident Alien
 $10 million in U.S. property and investments
 No advanced planning
 Death in either 2011 or 2012
Tentative Federal Estate Tax
Less Credit
($3,480,800)
$13,000
Net Estate Taxes
($3,467,800)
Net U.S. Assets
$6,532,200
Estate Shrinkage = 35%
For producer use only. Not for client presentation.
Gift Tax comparison: RA vs. NRA
Resident Alien (RA)
Non-Resident Alien (NRA)
Gift tax rate
35%
35%
Annual gift tax
exclusion amount
 $13,000
 $136,000 for gift to
non-U.S. citizen spouse
 $13,000
 $136,000 for gift to
non-U.S. citizen spouse
Lifetime gift tax
exemption amount
$5,000,000
None
All worldwide assets
All U.S. sitused property
including real property and
tangible assets.* Intangible
property is not included
Assets subject to
U.S. gift taxes
* Tangible property includes cash, jewelry, paintings, automobiles
For producer use only. Not for client presentation.
Sample Fact Finding Questions
What is the value of your
U.S.-based assets?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Did you know that the amount
your children inherit may be
reduced by 35% due to
U.S. federal estate tax?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
Will your children have enough
cash to pay the estate tax bill
upon your death?
For producer use only. Not for client presentation.
NRA with Significant U.S. Assets
Elaine’s Estate
Non-Resident
Alien
Elaine Chen
Corporation
Real estate &
investments
For producer use only. Not for client presentation.
Daughter
Daughter
Son
NRA with Significant U.S. Assets
Alternate Solution: Life Insurance
Elaine’s Estate
Non-Resident
Alien
Elaine Chen
Real estate &
investments
*Female, 62, preferred nonsmoker
For producer use only. Not for client presentation.
Lifetime Guaranteed
Level Death Benefit*
Death benefit = $3.5 million
Annual Premium = $54,430
Nonresident Aliens:
U. S. Gift and Estate Situs Rules
Type of
property transferred
Subject to
U.S. Gift tax
Subject to
U.S. Estate tax
Real property located in U.S.
Yes
Yes
U.S. tangible personal property (i.e.,
cash, jewelry, paintings, automobiles)
Yes
Yes
U.S. intangible personal property (i.e.,
stocks in U.S. corp., interest in U.S.
partnership)
No
Yes
Ownership interest in a U.S. life
insurance policy on the life of another
No
Yes
Ownership interest in a U.S. life
insurance policy on oneself
No*
No
A gift of a life insurance policy on oneself may be subject to the IRC §2035 look back rule, and therefore may be
subject to estate taxes if included within the decedent’s estate.
*
13
For producer use only. Not for client presentation.
Non-citizen Married to Citizen
 Mark and Anna, mid-60s
 Mark is a U.S. citizen
 Anna is a Canadian citizen
and Resident Alien
For producer use only. Not for client presentation.
Non-citizen Married to Citizen
Mark
U.S. Citizen
Unlimited Marital
Deduction
For producer use only. Not for client presentation.
Anna
Canadian citizen
Resident Alien
No Deduction
Sample Fact Finding Questions
Are you and your spouse
U.S. citizens?
For producer use only. Not for client presentation.
Sample Fact Finding Questions
What is the value of your
worldwide estate?
For producer use only. Not for client presentation.
Non-citizen Married to Citizen
Mark
U.S. Citizen
Anna
Canadian citizen
Resident Alien
For producer use only. Not for client presentation.
Unlimited Marital
Deduction
Non-citizen Married to Citizen
Alternate Solution: Life Insurance
Mark
U.S. Citizen
Anna
Canadian citizen
Resident Alien
For producer use only. Not for client presentation.
Legacy Trust with
Life Insurance
Why Transamerica?
 Dedicated international underwriting team
 Access to experts & marketing materials
 Expand market
 No product limitations
 Low or no minimum face amount*
 Close more business
 Best underwriting risk class generally available
* $100,000 minimum face requirement for TransTermSM and Trendsetter® products.
For producer use only. Not for client presentation.
Tapping Into the Foreign Nationals Market
 Align with immigration and/or international
tax attorneys
 Do you have contacts in foreign countries?
 Partner with international banking and
investment institutions
 Are you fluent in more than one language?
For producer use only. Not for client presentation.
Tapping Into the Foreign Nationals Market
 Develop a champion client
 Do you live in a location with high foreign
national investment?
 Do you live in a resort/vacation destination?
For producer use only. Not for client presentation.
Seizing the Opportunity
 Review your book of business
 Reach out to contacts that
match the client profile
 Strengthen and build your
referral network
For producer use only. Not for client presentation.
This material was not intended or written to be used, and cannot be used, to avoid penalties imposed
under the Internal Revenue Code. This material was written to support the promotion or marketing of
the products, services, and/or concepts addressed in this material. Anyone to whom this material is
promoted, marketed, or recommended should consult with and rely solely on their own independent
advisors regarding their particular situation and the concepts presented here.
Transamerica Life Insurance Company (“Transamerica”), and its representatives do not give tax or
legal advice. The material in this presentation is provided for informational purposes only and should
not be construed as tax or legal advice. Clients and other interested parties must be urged to consult
with and rely solely upon their own independent advisors regarding their particular situation and the
concepts presented here.
Discussions of the various planning strategies and issues are based on our understanding of the
applicable federal tax laws in effect at the time of presentation. However, tax laws are subject to
interpretation and change, and there is no guarantee that the relevant tax authorities will accept
Transamerica’s interpretations. Additionally, this material does not consider the impact of applicable
state laws upon clients and prospects.
Although care is taken in preparing this material and presenting it accurately, Transamerica disclaims
any express or implied warranty as to the accuracy of any material contained herein and any liability
with respect to it. This information is current as of March 2011.
OLA 2026 0311
For producer use only. Not for client presentation.
ESTATE PLANNING
Gift and Estate
Planning for
Foreign Nationals
OLA 2026 0311
For producer use only. Not for client presentation.