It is not unusual for U.S. citizens to own real estate in their ancestral “motherland” or to live abroad and own real estate in another country. Although Wills created in one state are generally recognized if you move to another state (under the U.S. Constitution’s “full faith and credit” clause), Wills and Trusts created in the U.S. may or may not be recognized by another country as valid if you move there or own real estate in another country.
Over 40 countries have entered into an agreement that recognizes a Will in one country to be valid in another country under “The Hague Convention Relating to the Form of Testamentary Disposition” if the Will is in accordance with: (1) the law of the place in which the testator (the person making the Will) had his or her habitual residence either at the time when he or she made the disposition, or at the time of death; or (2) the law of nationality possessed by the testator, either at the time of his or her death when he or she made the disposition; or (3) the law where the real estate or other immovable are located; or (4) the law where the testator made the Will; or (5) the law of a place in which the testator made the disposition, or at the time of his or her death.
Another convention called the International Will Convention was also adopted by the treaty recognizing Wills from other countries although a state in the U.S. would need to ratify the treaty for it to be effective in that state. Texas has not ratified the treaty. A total of 25 countries have ratified the agreement and another 120 have signed the agreement showing an intention to ratify in the future.
The Hague Trust Convention gained the consent of 14 countries that do not allow trusts to recognize trusts that are established in countries that permit the creation of trusts.
Notwithstanding these international treaties, it is advised that an attorney in each applicable country be contacted since each country has its own laws. Similarly, even if you have a Will or Trust created in another state and you move to a new U.S. state, an attorney familiar with the estate planning in the new state should be contacted since the laws of each state differ (so even though the Will or Trust may be valid, changes may be needed for various reasons). For example, domicile and residence rules may vary from state to state and country to country which could result in higher taxes. Furthermore, some countries require your resources to be distributed to certain beneficiaries (see article on “French Elvis”) although European Union countries may soon permit you to select the succession law of your nationality or domicile rather than where you are only a resident.
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