Preserving Your International Property for Future Generations

Buying property overseas is often a long-term decision. Maybe it's a rental apartment in London that has appreciated steadily over the years. Maybe it's a holiday home in Tuscany that eventually became your permanent base. Or perhaps it's an investment property in Sydney that now forms part of your retirement income.

Building international property wealth is one thing; transferring it efficiently is another.

For US expats, owning property abroad adds complexity because your estate may be subject to both US tax rules and the laws of the country where the property is located. Proper planning can help reduce delays, costs, and potential tax issues for your heirs.

Owning property in another country often means your estate has to navigate more than one legal system.

Although you're a US citizen living abroad, the United States generally considers your worldwide assets when determining whether your estate exceeds the federal estate tax filing threshold. For deaths occurring in 2025, that filing threshold is $13.99 million, although filing may also be required in some portability situations.

At the same time, the country where your property is located may have its own inheritance laws, probate procedures, or estate and inheritance taxes. Some countries also have forced heirship rules that can limit how property is distributed, regardless of what your will says.

That's why an estate plan drafted solely with US assets in mind may not always work as intended once overseas real estate enters the picture.

Make Sure Your Estate Documents Work Across Borders

One will isn’t automatically wrong, and for individuals with straightforward assets in a single legal system, it can be perfectly appropriate.

Still, if you own property in multiple countries, it's worth asking whether your estate documents have been prepared with each jurisdiction in mind. Some people choose separate wills for different countries to help streamline probate. Others prefer a single coordinated will to reduce administrative complexity.

What matters is coordination between the documents. Without it, overlapping wills can unintentionally revoke or override each other, creating avoidable probate complications.

Understand Potential Estate and Inheritance Taxes

A common misconception is that moving overseas also moves you outside the US estate tax system. Generally speaking, it doesn't.

US citizens remain subject to US estate tax rules on their worldwide assets. Meanwhile, the country where the property sits may impose its own estate, inheritance, or succession taxes depending on local law. Fortunately, the United States has estate tax treaties with several countries, including the United Kingdom, France, Germany, Australia, and others that can help reduce double taxation in certain circumstances.

That doesn't mean every international estate will face tax in two countries. Many won't. But it's something worth evaluating before your estate plan is finalized rather than after your family begins administering it.

Consider How the Property Is Owned

How the property is legally titled, whether in your name, jointly, through a company, or in a trust, can significantly affect how it is taxed, transferred, and administered across different countries.

For example, property owned jointly may transfer differently from property owned individually. Likewise, holding real estate through a trust or another legal structure can affect probate, reporting obligations, and tax treatment.

It's tempting to copy a structure that worked for a friend. Yet what makes sense for someone with a holiday villa in Spain may not be appropriate for a family with rental properties in Australia and Canada. The details really do matter.

Once your estate spans multiple countries, planning becomes less about filling out documents and more about making sure different advisers are working from the same playbook.

An estate lawyer may understand local succession rules. A US expat tax specialist can explain how US estate tax rules interact with foreign assets. Neither professional necessarily replaces the other.

If you own high-value overseas property, several rental properties, trusts, or investments spread across different countries, working with professionals who regularly handle US expat tax services and cross-border estate planning can help uncover issues that might otherwise be overlooked. The goal isn't to create a more complicated plan. Quite the opposite. It's to make things simpler for the people who eventually inherit your assets.

Even without making major changes, a few practical habits can make a meaningful difference:

• Update your estate plan after buying property overseas.

• Keep records of purchase costs, renovations, and ownership documents.

• Review how each property is titled and whether that still reflects your wishes.

• Coordinate US tax advice with local legal advice before making significant ownership changes.

• Revisit your plan after major life events such as marriage, divorce, relocation, or acquiring additional property.

No estate plan stays perfect forever. As your property portfolio grows, your planning should grow with it.

International property can become one of the most valuable parts of your family's legacy. Preserving that legacy, however, usually requires looking beyond the property itself and considering how different legal and tax systems fit together.

If your estate includes overseas real estate, now is a good time to review whether your current plan still reflects your goals. And if your situation crosses multiple jurisdictions, seeking experienced expat tax services alongside local estate planning advice can help ensure your wealth reaches the next generation with fewer unexpected complications.