# Inheritance from usa.



## DirectDevil (9 Jul 2010)

What are the tax impliactions in the following scenario ;

D, an American resident dies.

D leaves a substantial cash bequest to B.

D and B are sister-in-law and brother-in-law respectively.

B is an Irish citizen/resident/taxpayer.

Q 1. As I understand it B has no INCOME TAX liability. Is this correct ?

Q 2. Does B have a liability to a capital tax ?

As best as I can figure it out, B should have a liability to Gift / Inheritance tax as the inheitance seems to well exceed the CATERGORY C threshold. Is this right ?

Q 3. If there is a liability I take it to be at the rate of 25% of the excess above the CATERGORY C threshold. Is this right ?

Thanks for any information as I am not clear from the Revenue site if my understanding is correct.


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## dereko1969 (9 Jul 2010)

B has a liability to Capital Acquisitions Tax @ 25% but they can also use the annual small gift allowance of €3000 see here
http://www.revenue.ie/en/tax/cat/gift-inheritance.html


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## Brown (9 Jul 2010)

You may also be liable for Estate tax in the United States.


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## CXC (13 Jul 2010)

No small gift exemption in an inheritance situation. Note CAT applies if the beneficiary is resident or oridarily resident but can be avoided if they have only been resident throughout the previous 5 consecutive years and are non domiciled. Note Ireland and USA also have double tax treaty, I believe it has relevant provisions on CAT. It would be worthwhile getting proper tax advice on this given the potential exposure as the inheritance is well above category C.


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## Towger (13 Jul 2010)

What about the very old 'Money from America' rule, our politicians like to use to cover their kickbacks?


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## NM&A (15 Jul 2010)

It seemed you got your answer on another site.....on eboards.ie


if you had to pay Estate tax in USA you would get this amount as a deduction against Irish CAT (inheritance tax)....but not as an offset....slight difference.


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## DirectDevil (16 Jul 2010)

Thanks for those replies. Much appreciated.


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