USA – NEW YORK Law and Practice Contributed by: John M Teitler, Nancy A Murphy and Constance E Shields, Teitler & Teitler LLP
advance of either immigrating to, or exiting from, the US. 1.5 Taxation of Real Estate Owned by Non- Residents and Non-Citizens A US/NY non-resident is generally subject to US/NY income, US gift, and US/NY estate tax on real and cer - tain tangible personal property located in New York. The applicable income tax rates for both jurisdictions are between approximately 30% and 55%. 1.6 Stability of Tax Laws The US and NY tax rates are somewhat stable; how - ever, these rates may change depending on the fiscal philosophy of any incoming administration. Given the impact of COVID-19, these rates could increase sig - nificantly as the federal and New York governments seek additional funds to cover governmental spend - ing. Effective 1 January 2026, the “One Big Beauti - ful Bill Act” set the gift and estate tax exemption at USD15 million per person, or USD30 million for a mar - ried couple. This exemption amount will be indexed for inflation in future years. For amounts transferred that exceed the exemption, there is a federal tax at 40%. There is no state level gift tax imposed except in Connecticut. 1.7 Transparency and Increased Global Reporting The United States and New York have an increased focus on transparency and reporting. The Corporate Transparency Act (CTA) came into effect on 1 Janu - ary 2024. The CTA is a federal reporting requirement for owners and managers of a majority of US entities to report to FinCen, among other things, the entities’ information, including any beneficial owners. There are many exceptions to the reporting requirement available on the FinCen website. As of 26 March 2025, entities created in the United States and their beneficial owners are now exempt from the require - ment to report beneficial ownership information to FinCen. Foreign financial companies remain subject to the CTA. New York has adopted a similar reporting regime called the LLC Transparency Act that applies to LLCs formed or authorised to do business in New York. Entities in existence before 1 January 2024 had until 31 December 2024 to comply with federal and New York reporting requirements. Entities created
after 31 December 2024 have to comply soon after creation. These reporting requirements are evolving.
2. Succession 2.1 Cultural Considerations in Succession Planning In the United States, particularly in New York, there is a growing trend among older generations to establish significant trust structures for their children and future generations. Importantly, clients are forming unregu - lated private trust companies in New Hampshire and other states to further their estate planning goals and ensure their governance views for the coming genera - tions. 2.2 International Planning There is an increasing trend for multi-national fami - lies to obtain US/NY tax advice as well as advice in other non-US jurisdictions. Importantly, such advice is often inconsistent and requires lead tax counsel to co- ordinate tax advisers across a number of countries. 2.3 Forced Heirship Laws In New York, while there are no explicit forced heirship laws, a decedent who is married at the time of death cannot disinherit their surviving spouse unless there is a prior agreement to do so. If a decedent dies with a will, the surviving spouse has an elective share to receive one-third of the deceased spouse’s net estate (generally, gross estate less debts and administra - tion expenses). The surviving spouse has the right to assert the spouse’s elective share, in lieu of taking under the deceased spouse’s will. The elective share is an outright pecuniary amount, and various testa - mentary substitutes passing outright to the surviving spouse, such as property held with rights of survi - vorship, count towards satisfying the elective share. Importantly, if a spouse asserts the elective share, such spouse does not take under the decedent’s will. If a decedent dies without a will and is married with - out children, 100% of the decedent’s probate estate passes by intestacy law to the surviving spouse. If a decedent dies without a will and with children, 50% of the decedent’s probate estate passes to the surviving spouse by intestacy, and the other 50% of the pro -
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