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Question:

I have property in Ireland which I would like to have go to relatives in Ireland and the United States. Will my U.S. will and trust be sufficient or do I need to hire a lawyer in Ireland as well?

Response:

I’d recommend that you work with a solicitor in Ireland. To reference former Defense Secretary Donald Rumsfeld, we don’t know what we don’t know. Your U.S. will and trust may or may not be honored in Ireland. While Irish laws may derive from English common law as does much of the law in the United States, there may be many departures. For those reading this post who have property in other countries, they very well may not honor trusts at all. Only a lawyer (or solicitor) with knowledge of the law in the country in question can advise you on what steps are necessary to take in that country to make sure your non-U.S. property passes as you wish.

In addition to the law, there are practical concerns. For instance, Ireland may honor your U.S. will, but the process may be more cumbersome, time-consuming and expensive than if you had an Irish will or trust. For instance, in the United States where every state must honor a will created in another state, we often advise clients owning real estate in a state different from the one in which they reside to put the property in trust in order to avoid the expense of two separate probate processes, one in the state of residence and another in the state where the real estate is located.

There also may be traps for the unwary, especially in relation to taxes. By way of example, Canada taxes capital gains differently from the United States. Here, they’re taxed only when property is sold. In Canada, they are taxed when the property is conveyed, even as a gift or into trust. This can come as a surprise and mean raising the cash to pay the tax even without the proceeds of a sale of property.

Finally, make sure your U.S. and Irish attorney coordinate their efforts in order to avoid any snafus, inconsistencies or misunderstandings regarding your non-U.S. property.

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