8 Cross-Border Estate Planning Mistakes to Avoid With Wealthy Clients

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While it is not a topic that many financial planners are experts in today, cross-border estate planning is an increasingly important issue for wealthy global families.

In fact, according to experts with Cerity Partners who specialize in international estate planning, the provision of such services represents a great opportunity for fiduciary financial planning firms looking to elevate their service and attract multigenerational clients.

The firm recently hosted a webcast on the topic featuring Frederic Behrens, a New York-based partner at the firm, and Libby Dawson, a principal in the San Francisco office. According to the duo, international estate planning can become incredibly complex, and the failure to appreciate that complexity can lead to costly mistakes and disappointed clients.

As Behrens and Dawson emphasized, a coordinated international estate plan is essential for families who face the possibility of a foreign-located decedent, beneficiaries in multiple countries or assets in different jurisdictions.

According to the duo, global families — especially wealthy U.S. expats — who are creating an international estate plan need to understand relevant rules related to domicile, succession, generation-skipping transfers, gift tax laws in each country where distribution will occur, and where assets are held at the time of a decedent’s death.

These matters are already complex, the experts warned, but adding multiple U.S. citizens or green card holders into the mix can complicate things even further.

Ultimately, failing to consider multijurisdictional estate planning issues may create dramatic consequences, including assets passing to the wrong beneficiaries and excessive taxes. Fortunately, Behrens and Dawson said, many of these unwanted financial and emotional ramifications can be avoided with the proper international estate planning strategy.

See the slideshow for a review of eight potential pitfalls that can derail an international estate planning effort. As Behrens and Dawson emphasized, advisors who can help their clients avoid these and related issues will stand out in a highly competitive and demanding marketplace.