The U.S.-situated Gross Estate for a nonresident not a citizen of the United States includes only assets that are considered "situated" in the United States at the time of the decedent's death. The determination of what constitutes U.S.-situated property is guided by several sections of the Internal Revenue Code and Treasury Regulations.
- Real Estate and Tangible Property:
- U.S. real estate and all tangible property located in the United States are included in the U.S.-situated Gross Estate.
- Intangible Property:
- Shares of stock issued by a domestic corporation.
- Debt obligations of a U.S. person, the United States, a State, any political subdivision thereof, or the District of Columbia.
- Deposits with a domestic branch of a foreign corporation engaged in the commercial banking business.
- Transferred Property:
- Any property transferred by the decedent within the meaning of sections 2035 to 2038, if the property was situated in the United States either at the time of the transfer or at the time of the decedent’s death.
- Bank Accounts:
- Bank accounts used in connection with a U.S. trade or business.
- Exclusions:
- Proceeds of life insurance on the life of a nonresident not a citizen of the United States.
- Certain bank deposits and debt obligations that would not be subject to tax under sections 871(i)(1) and 871(h)(1).
- Works of art imported solely for exhibition purposes and loaned to a public gallery or museum.
- Stock in a regulated investment company (RIC) to the extent that the RIC's assets are qualifying assets, such as those described in section 2105(b).
- Valuation:
- The value of each asset included in the U.S.-situated Gross Estate is based on its fair market value at the time of the decedent’s death.
In summary, the U.S.-situated Gross Estate for a nonresident not a citizen includes U.S. real estate, tangible property located in the U.S., certain intangible property such as U.S. marketable securities and debt obligations, and specific bank accounts and transferred property. Certain exclusions apply, such as life insurance proceeds and specific bank deposits and debt obligations. The valuation of these assets is based on their fair market value at the time of death.
Sources:
§ 2105. Property without the United States
§ 20.2031-1. Definition of gross estate; valuation of property.
§ 2104. Property within the United States
CCA 201020009
§ 2103. Definition of gross estate
