by peaceyeh » Tue Sep 22, 2009 08:01 am
Hello all insurance expert!
I am urgently needing your advice.
My father purchased a life insurance policy for my mother 20 years ago and my mother recently passed away. We are not US citizen nor resident alien(green card holder) and currently living in Asia. My question is will IRS deducts tax from my mom's death benefit from the life insurance when insurance company wire transfer the money? I was told there is some kind of regulation as W-8BEN, can we avoid that and make sure to get the full amount of death benefit back? (I believe life insurance is non-taxable for US citizen and resident alien for sure which state in IRS website)
My email address is peaceyeh[at]hotmail.com and your kindly help with advice is truly appreciated.
Best Regards,
Michael Yeh
I am urgently needing your advice.
My father purchased a life insurance policy for my mother 20 years ago and my mother recently passed away. We are not US citizen nor resident alien(green card holder) and currently living in Asia. My question is will IRS deducts tax from my mom's death benefit from the life insurance when insurance company wire transfer the money? I was told there is some kind of regulation as W-8BEN, can we avoid that and make sure to get the full amount of death benefit back? (I believe life insurance is non-taxable for US citizen and resident alien for sure which state in IRS website)
My email address is peaceyeh[at]hotmail.com and your kindly help with advice is truly appreciated.
Best Regards,
Michael Yeh
Posted: Tue Feb 23, 2010 02:20 am Post Subject:
Interesting. Maybe they give more leniency to the UK. We were looking at someone in the Phillippines. They said no chance on taking an APS from a Phillippines doctor and that unless the person had a residency in the US, they wouldn't consider it. Tried to shop it with about 15 companies, all with the same answer.
Also, it wouldn't just be the application that has to be signed in the US - they would have to complete the exam and sign any delivery requirements in the US too, forcing them to be here 2-3 times to get coverage, even if it could be approved. I'm sure it would be even more complicated for a 70-year-old who has likely had past health issues the company would want to know about. If they aren't taking an APS from an overseas doctor, they probably aren't taking a long history of APS's either.
Posted: Tue Mar 22, 2011 02:19 pm Post Subject: non-US citizen or non-resident alien and IRS
According to Publication 17 IRS Tax Code. The death benefit itself is not taxable, but any interest paid will be subject to a 30% tax rate. Certain States Tax this income at different levels also (Such as CA and other states in the US). When it comes to the Estate of a person living in the US, the NON-US Citizen must pay taxes on any Estate properties (Bank Accounts, Homes, cars, etc.....) if the values of thses properties exceeds $2,000,000. Also, if the NON-US Citizen is living outside of the United States, the country you live in may have an income tax requirements on the money or estate goods. This depends on the treaty requirements between the US and the country in question.
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