Asked
I will be coming into a lump sum inheritance in coming months.
This is via a family trust.
My father will be selling off his portion of what his mother mother left her children and will be dividing it between his 4 canadian children, rather than waiting until he passes.. The trust is in the US.
Does anyone have knowledge of this process and if there is any taxing that happens between country's?
I'll be asking a tax specialist but thought I'd hop in here first!
Clint’s answer
Specifics will be required to deliver to your accountant/tax specialist.
Typically trusts are their own entity and will be taxed accordingly prior to any money being distributed to the trust beneficiaries or owners so any amount the trust has made will likely have already been reported and tax payments remitted up to date.
Distribution might be taxed in the US at the source, but there is no inheritance tax in Canada, so this may or may not be refundable through Foreign Tax Credits or by applying for a refund through the IRS.
January 5, 2025
From Ask Clint: real questions from a Canadian public finance forum, answered by Clint Cole. Names are changed. This is general information, not advice for your situation, and rules and dollar figures may have changed since Clint answered. Terms