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<DIV style="FONT-SIZE: 12pt; FONT-FAMILY: 'Calibri'; COLOR: #000000">
<DIV>Sam, funny story: The request for advice actually came from an
attorney friend (a retired litigator) on behalf of <U>her</U> British
friends. For brevity’s sake I compressed it as if I were the attorney
being asked for advice by the Brits. Your response is so thoughtful and
right on, and I am forwarding it to my attorney friend, verbatim. Thanks
for taking the time to compose such excellent advice. </DIV>
<DIV> </DIV>
<DIV>Sincerely,</DIV>
<DIV> </DIV>
<DIV>Felicia </DIV>
<DIV> </DIV>
<DIV style="FONT-SIZE: 12pt; FONT-FAMILY: 'Calibri'; COLOR: #000000">Felicia
Value<BR>Attorney at Law<BR>PO Box 578/116 North Third Street<BR>La Conner, WA
98257<BR>(360) 466-2088<BR><A
href="http://www.skagitprobate.com">www.skagitprobate.com</A><BR><BR>NOTE: I do
not use encrypted email. Messages sent to or<BR>from my office via email are not
secure and may not be<BR>protected by attorney client privilege. This email
address<BR>is not monitored at all times. If your matter is urgent,<BR>please
phone my office during regular business hours.<BR><BR>This email may contain
confidential material protected by<BR>attorney/client privilege, and is intended
for use solely by the above<BR>referenced recipient. Any review, copying,
printing, disclosure,<BR>distribution, or other use by any person or entity is
strictly<BR>prohibited and may be unlawful. If you are not the named recipient,
or<BR>believe you have received this email in error, please reply to
the<BR>sender and delete the copy you received. Thank you.<BR>
<DIV
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<DIV
style='FONT-SIZE: small; TEXT-DECORATION: none; FONT-FAMILY: "Calibri"; FONT-WEIGHT: normal; COLOR: #000000; FONT-STYLE: normal; DISPLAY: inline'><B>From:</B>
<A title=sam@furgasons.com href="mailto:sam@furgasons.com">Sam Furgason</A>
</DIV>
<DIV style="FONT: 10pt tahoma">
<DIV style="BACKGROUND: #f5f5f5">
<DIV><B>Sent:</B> Tuesday, November 11, 2014 10:43 PM</DIV>
<DIV><B>To:</B> <A title=wsbapt@lists.wsbarppt.com
href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</A> </DIV>
<DIV><B>Subject:</B> Re: [WSBAPT] UK Citizens w/ US Real
Estate</DIV></DIV></DIV>
<DIV> </DIV></DIV>
<DIV
style='FONT-SIZE: small; TEXT-DECORATION: none; FONT-FAMILY: "Calibri"; FONT-WEIGHT: normal; COLOR: #000000; FONT-STYLE: normal; DISPLAY: inline'>
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<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'>Felicia,<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>First, these
people are asking you because you are a lawyer, not just a friend. Their
questions are about legal matters. If you undertake to give them advice, whether
directly or through forwarded comments by others, you have become their attorney
on this matter. I’m sure they may treat this as a simple question, but really,
casual advice yields casual results. Good advice would be to tell them that this
is a matter of some complexity, and should merit their getting serious advice.
I’d hazard a guess that they would appreciate and respect such a response.
<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>No one who
has answered has any real idea where this real property is located, how large or
small your friends’ estate is, what the real property is worth, and probably
little idea about UK law. And you’re willing to pass their lawyer to lawyer
suggestions on to your friends for them to make life decisions on? I wouldn’t.
<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>For example,
Washington estate tax law looks at the <I>entire </I>estate of a decedent when
determining whether an estate tax is owed. If the entire estate exceeds the
taxable exemption, then an estate tax is imposed, the amount of which is in
proportion to the portion of their estate which is located in Washington. So if
they have property which is deemed located in Washington, and one of them dies,
then at a minimum a determination will have to be made whether that decedent’s
entire estate exceeds the inflation-adjusted $2,000,000 Washington exemption at
the date of death. Under British law, the answer to that question could depend
on which spouse dies, as England does not, to my belief, have community property
law. <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>They should
consider whether it would be advantageous to hold the property in an entity
which would be deemed intangible personal property, as such property is
considered located where the owner is domiciled, under Washington estate tax
law. Also, entitizing the property to make it intangible personal property, and
then having the first decedent’s portion pass to a trust could both reduce the
estate tax value of the interest passed (assuming it is less than a controlling
interest), and remove that interest from Washington for Washington estate tax
purpose. <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>However, what
if re-locating the real property, so to speak, to the law of the domicile
actually creates a disadvantageous death tax situation? <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>Another
consideration is that the U.S. property of persons who are non-resident
noncitizens is treated differently from that of residents and citizens.
<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>Then you have
to recognize that a U.S. trust must have at least one U.S. trustee, in order to
avoid certain tax consequences relating to recognition of taxable gains. So, if
your friends/clients (remember, they are clients if you provide them with any
legal advice, whether by forwarding answers form this list or otherwise) find
that using a trust to hold the property is advantageous, they will have to
consider how to deal with the U.S. person issue. [Note to “friends:” I am not
your attorney, and if you read this I am not offering it as legal or tax advice.
I recommend you contact legal counsel who can gather all the relevant facts and
provide informed advice.]<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>My suggestion
would be that if this seems too complex for you to educate yourself on, so that
you can give them useful advice, then simply tell them this issue involves
international complexities and tax issues which they should consult with
knowledgeable counsel about. Or, you could just as well say that you can handle
this but you will have to do some research on it, and give them your hourly
rate, as well as agreeing on an amount they can agree to pay before
re-evaluating. The lawyers in the big firms charge by the hour to educate
themselves (or their junior associates) on these issues; it is not as though
they come out of law school knowing everything. They develop expertise by
learning while getting paid. If it’s over your head, either consult with someone
who has expertise, or refer them to some such attorney. Who knows? You may
become a local expert on this narrow field. Of course, that would mean you’d
have to become a CLE presenter and article writer, etc. <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>Those are my
thoughts. <o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN style='FONT-FAMILY: "Calibri",sans-serif'>S
<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Samuel L.
Furgason<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Samuel L. Furgason,
Inc, PS<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Law Practice Limited
to Existing Clients<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>800 Bellevue Way
N.E., Suite 400<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Bellevue, Washington
98004<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>MAIL
TO:<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>PO Box
102<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Medina, WA
98039-0102<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Work:
(425) 649-1122<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Cell:
(425) 445-9909<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>Email:
sam@furgasons.com<o:p></o:p></SPAN></P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif'><o:p></o:p></SPAN> </P>
<DIV>
<DIV
style="BORDER-TOP: #e1e1e1 1pt solid; BORDER-RIGHT: medium none; BORDER-BOTTOM: medium none; PADDING-BOTTOM: 0in; PADDING-TOP: 3pt; PADDING-LEFT: 0in; BORDER-LEFT: medium none; PADDING-RIGHT: 0in">
<P class=MsoNormal><B><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>From:</SPAN></B><SPAN
style='FONT-SIZE: 11pt; FONT-FAMILY: "Calibri",sans-serif'>
wsbapt-owner@lists.wsbarppt.com [mailto:wsbapt-owner@lists.wsbarppt.com] <B>On
Behalf Of </B>Felicia Value, Attorney at Law<BR><B>Sent:</B> Tuesday, November
11, 2014 1:40 PM<BR><B>To:</B> WSB Listserv<BR><B>Subject:</B> [WSBAPT] UK
Citizens w/ US Real Estate <o:p></o:p></SPAN></P></DIV></DIV>
<P class=MsoNormal><o:p></o:p> </P>
<DIV>
<DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">Hello
Colleagues:</SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'> <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: black">I have a
question on behalf of some friends. They are UK citizens with their primary
residence in the UK. They own some property in the US that they want to leave to
their daughter. Do they need a US Will to do that? </SPAN><SPAN
style="FONT-SIZE: 13.5pt; COLOR: #141823">Is there some sort of ancillary
proceeding that you open in the US to administer the property, even if the
primary probate proceeding is in the UK? I suppose they could add the
daughter to the title as a co-owner with right of survivorship, but for exposure
reasons I’m never crazy about that idea. Should I tell them to consult US
counsel, or is this really simple and can just be dealt with easily in the
administration of the UK Will?</SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'> <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN style="FONT-SIZE: 13.5pt; COLOR: #141823">I will
forward your responses directly to my friends. Thanks for any
thoughts.</SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'> <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style="FONT-SIZE: 13.5pt; COLOR: #141823">Sincerely,</SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'> <o:p></o:p></SPAN></P></DIV>
<DIV>
<P class=MsoNormal style="MARGIN-BOTTOM: 12pt"><SPAN
style="FONT-SIZE: 13.5pt; COLOR: black">Felicia Value<BR>Attorney at Law<BR>PO
Box 578/116 North Third Street<BR>La Conner, WA 98257<BR>(360)
466-2088<BR></SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><A
href="http://www.skagitprobate.com"><SPAN
style='FONT-SIZE: 13.5pt; FONT-FAMILY: "Times New Roman",serif'>www.skagitprobate.com</SPAN></A><BR><BR></SPAN><SPAN
style="FONT-SIZE: 13.5pt; COLOR: black">NOTE: I do not use encrypted email.
Messages sent to or<BR>from my office via email are not secure and may not
be<BR>protected by attorney client privilege. This email address<BR>is not
monitored at all times. If your matter is urgent,<BR>please phone my office
during regular business hours.<BR><BR>This email may contain confidential
material protected by<BR>attorney/client privilege, and is intended for use
solely by the above<BR>referenced recipient. Any review, copying, printing,
disclosure,<BR>distribution, or other use by any person or entity is
strictly<BR>prohibited and may be unlawful. If you are not the named recipient,
or<BR>believe you have received this email in error, please reply to
the<BR>sender and delete the copy you received. Thank you.</SPAN><SPAN
style='FONT-FAMILY: "Calibri",sans-serif; COLOR: black'><o:p></o:p></SPAN></P></DIV></DIV></DIV>
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style='FONT-SIZE: 10pt; FONT-FAMILY: "Arial",sans-serif; COLOR: black'>=======================</SPAN><o:p></o:p></P>
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