Non-US client with significant US-situs assets
A non-US client had built substantial wealth through US investments despite never becoming a US citizen or long-term resident.
The portfolio worked well from an investment perspective.
The estate-planning problem was different.
A material part of the client's wealth was exposed to the US estate-tax regime because the underlying assets were US-situs.
This case study shows how financial planning can sit alongside US estate-tax and legal advice to reduce unnecessary exposure while preserving the client's long-term investment objectives.
The client position
The client was internationally resident, non-US and had accumulated a substantial portfolio of US assets over many years.
Their position included:
- a US brokerage account
- individually held US-listed shares
- US-listed funds
- a US retirement account
- non-US investments
- property outside the United States
- beneficiaries living in more than one country
The portfolio had been built for investment reasons rather than estate planning.
The immediate concern arose when the professional team identified that part of the portfolio could potentially fall within the US estate-tax regime.
The financial-planning question became:
Could the client retain equivalent investment exposure without carrying unnecessary US-situs estate-tax risk?
This case study is illustrative and has been anonymised. Individual circumstances vary and tax and legal advice should be obtained where appropriate.
The issues that needed to be coordinated
US-situs asset exposure
The client's US investments needed to be reviewed individually to determine which assets were potentially within the US estate-tax net.
US estate tax
The specialist US adviser needed to establish the client's status, applicable thresholds, treaty position and potential estate-tax exposure.
Brokerage structure
The client needed to understand whether the existing US custody arrangement remained appropriate from an estate-planning perspective.
Retirement assets
The client's US retirement account needed to be analysed separately from the taxable brokerage portfolio.
Beneficiaries
The client's intended beneficiaries lived in different jurisdictions and needed to be considered alongside the asset structure.
Investment objectives
Any restructuring still needed to preserve diversification, liquidity, growth potential and the client's long-term risk profile.
What the professional team needed to establish
Was the client a US person?
The client's citizenship, residence and domicile needed to be clearly established.
Which assets were US-situs?
The underlying investments mattered more than the location of the brokerage account alone.
Was treaty relief available?
The relevant US adviser needed to confirm whether an estate-tax treaty affected the position.
What was the potential estate-tax liability?
The exposure needed to be quantified before restructuring was considered.
Could the same investment objective be achieved differently?
The financial plan needed to test whether the client could reduce US-situs exposure without materially weakening the portfolio.
What assets should remain in the US?
Not every US asset necessarily required change.
How should beneficiary planning be coordinated?
Ownership, nominations and estate-planning documents needed to remain aligned.
The role of financial planning
The US tax and estate advisers established the technical estate-tax position.
Josh's role was to translate that analysis into a practical investment and financial-planning strategy.
That meant understanding:
which assets created the estate exposure
which assets could remain unchanged
which holdings could potentially be restructured
how the client could maintain comparable market exposure
how the changes affected liquidity, risk and beneficiaries
The objective was not simply to reduce tax.
It was to reduce unnecessary estate-tax exposure without compromising the client's wider financial plan.
The planning approach
Identify the exposed assets
The taxable brokerage portfolio was separated from pensions, non-US assets and other holdings.
Quantify the estate-tax risk
The US estate adviser established the potential exposure under the client's current structure.
Separate market exposure from asset situs
The team distinguished between wanting US market exposure and needing to own US-situs assets directly.
Review alternative investment structures
The financial plan considered whether similar diversification and growth objectives could be achieved using non-US-situs investments.
Preserve liquidity
Any restructuring needed to leave sufficient accessible capital for the client's near-term needs.
Coordinate beneficiaries
The new investment structure was considered alongside wills, nominations and the wider estate plan.
The key distinction was between US investment exposure and US-situs ownership
The client wanted continued exposure to US markets.
That did not automatically mean the client had to hold US-situs securities directly.
This distinction became central to the planning.
The objective was to preserve:
- global diversification
- exposure to US equities
- liquidity
- transparent costs
- appropriate risk
while reducing the part of the portfolio creating unnecessary estate-tax exposure.
This allowed the client to retain the economic exposure they wanted without assuming that the existing legal ownership structure had to remain unchanged.
The result: the estate issue became part of the investment strategy
Before the review, the client's investment and estate planning had effectively been treated as separate matters.
After coordination, the two were considered together.
The planning framework gave the client:
- a clearer understanding of US estate-tax exposure
- a distinction between retirement and taxable assets
- a more deliberate custody structure
- reduced unnecessary concentration in US-situs assets
- continued access to diversified investments
- better alignment between investments and beneficiary planning
The value was not in avoiding US investments entirely.
It was in ensuring the form of ownership supported the client's wider estate and financial objectives.
Useful resources for similar cases
US Estate Tax Exposure for Non-US Persons With US-Situs Assets
A focused technical brief covering the estate-tax issues that can arise where a non-US person holds US property or securities.
The Professional Adviser's Guide to US-Situs Assets and Estate Tax Exposure
A broader guide to identifying and coordinating US estate-tax exposure for international clients.
Cross-Border Beneficiary and Estate Coordination
A technical brief covering the interaction between investments, beneficiaries and estate planning across jurisdictions.
The Professional Adviser's Guide to Cross-Border Estate and Beneficiary Planning
A broader guide to coordinating international assets, beneficiaries, pensions and estate structures.
International Estate Planning Coordination Checklist
A practical checklist for reviewing assets, beneficiaries, liquidity and professional advisers across jurisdictions.
Cross-Border Referral Checklist
A practical resource for identifying when specialist tax, estate and financial-planning input may be needed.