Try telling that to this elderly Canadian widow who was just hit with $93,000 to the IRS on her Canadian husband’s estate–on top of the $37,00 she paid to CRA.
Global National: Canadians Paying Taxes to IRS
More stories like this would help highlight how the Canadian-US tax treaty does not protect against double taxation. Unfortunately the Global news story doesn’t add up. FATCA reporting hasn’t begun. It certainly hadn’t begun when this lady filed estate taxes, if that’s what she in fact paid. There isn’t enough info to know what or why she paid.
It is more likely that she ran afoul of a compliance condor who advised her to file something in the US.
However, if her husband were solely Canadian then AFAIK, there would be no estate tax due to the US because estate taxes in the US are paid by the Estate not the heir. There is also a 5 million lifetime exemption.
Perhaps the estate had US assets. Who knows? But the Global story doesn’t make sense.
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