Warning: Marriage to a ‘Foreigner’ May Be Hazardous to Your Tax Health

Recently, I am seeing more and more married couples of dual nationality (with one US individual partner) struggling with the US tax issues wrought by such a “mixed marriage”.  Some are same sex couples married under the laws of a foreign (non-US) jurisdiction.   Believe it or not, marriages taking place in a foreign country (whether or not same sex) may or may not be recognized by the US tax laws.  This will impact many aspects of the couple’s US tax situation – income tax, gift tax and estate tax matters arise.  If you are not considered to be “married”, for example, then you cannot use the “married filing jointly” tax status;  tax information reporting of foreign assets held jointly is impacted; if you are not married, you cannot make gifts or leave bequests to your “spouse” in as favorable a manner as those who are “married”. The list goes on!

Due to my recent client matters in this area, I was reminded of one of my interviews that took place last year.  I was interviewed on Canadian TV in 3 different sessions covering the US tax complications when a US person and non-US person are married. I am being interviewed by John Richardson, a Canadian and US attorney. John calls this phenomenon the #FBARMarriage.  What an appropriate name!

Some marriages don’t last — perhaps in some cases due to the unique stresses of the #FBARMarriage.  Well, a whole new set of complexities arise with the #FBARDivorce! You can read about those here and here.

You may find the interviews of interest… or perhaps you have colleagues who may find them of interest. Please pass them on.

Here are links to all 3 in the series!

https://www.youtube.com/watch?v=cq_5Kok0viM

https://www.youtube.com/watch?v=9qQxN3EsJ2o

https://www.youtube.com/watch?v=wwVrF9LlLMU

 

Posted: June 10, 2020

 

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Visit my earlier US tax blog “Let’s Talk About US Tax” hosted by AngloInfo since 2011, it contains all my old posts. Some hyperlinks to my blog posts on AngloInfo may have expired.  If you copy the expired URL, you can most likely retrieve the actual post by using the “Wayback Machine” which is an archiving service.  Simply paste the URL into the Wayback Machine search box. It will show you the archived post was saved on a specific date. Click on that date to retrieve the post.

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