An Estate in Washington DC, Maryland, Virginia or California Has Heirs Abroad
Someone has died in the District of Columbia, Maryland, Virginia or California, and the heirs, or some of them, live in another country. The estate goes through the probate court of the state, pays the federal and any state death taxes, and then distributes abroad with the withholding and the papers each payment requires. The firm’s attorneys administer the estate, or advise the executor who does.
Law stated as of October 2026
In brief.
- The estate of a U.S. citizen or domiciliary is taxed on its worldwide property; for a death in 2026 the federal estate tax applies only above USD 15,000,000 (section 2010(c)), but Maryland taxes estates above USD 5,000,000 and the District of Columbia estates above an indexed threshold (USD 4,873,200 for deaths in 2025).
- Whether an heir who lives abroad may serve as executor depends on the state: the District of Columbia and Maryland exclude most foreign nationals without a green card, Virginia admits a nonresident with a resident agent and a bond, California admits a nonresident only if the will names that person.
- The surviving spouse’s share qualifies for the marital deduction only if the spouse is a U.S. citizen or the property passes to a qualified domestic trust (section 2056(d)).
- Distributions to heirs abroad carry out the estate’s income, on which the executor withholds 30 percent or the treaty rate and files Forms 1042 and 1042-S; the inheritance itself is not taxed to the heir in the United States.
- Each heir’s own country may tax what the heir receives; the estate’s papers, the Schedule K-1 and the Form 1042-S are prepared with that return in mind.
What is happening
The estate of a person domiciled in the United States is administered where the person lived: the Probate Division of the Superior Court in the District of Columbia, the Register of Wills and the Orphans’ Court in Maryland, the clerk of the circuit court in Virginia, the Superior Court in California. The personal representative collects the assets, publishes notice to creditors, files the decedent’s final income tax return and the estate’s own returns, pays the taxes and distributes. The federal estate tax reaches the worldwide estate (section 2031), with a basic exclusion amount of USD 15,000,000 for deaths in 2026 and a top rate of 40 percent (sections 2001(c) and 2010(c)); Form 706 is due nine months after the death (section 6075(a)). Maryland levies an estate tax above USD 5,000,000 and an inheritance tax of 10 percent on what passes to persons other than close relatives (Md. Code, Tax-Gen. §§ 7-203, 7-204, 7-309); the District of Columbia levies an estate tax above a threshold indexed each year (USD 4,873,200 for deaths in 2025; D.C. Code § 47-3701), with the return due ten months after the death. Virginia and California levy no estate or inheritance tax.
Heirs abroad change the administration in three places. First, the appointment: the District of Columbia grants letters to a foreign national only if lawfully admitted for permanent residence, and to a nonresident only on a power of attorney in favour of the Register of Wills (D.C. Code § 20-303(b)); Maryland admits a non-citizen only as a permanent resident who is the spouse, ancestor, descendant or sibling of the decedent, and a nonresident only with a resident agent (Md. Code, Est. & Trusts § 5-105(c)); Virginia admits a nonresident who consents to service of process and gives bond with surety unless a resident co-fiduciary serves (Va. Code § 64.2-1426); California treats a person who does not live in the United States as not competent unless the will names that person as executor (Cal. Prob. Code § 8402). Second, the spouse: the marital deduction is denied where the surviving spouse is not a U.S. citizen, unless the property passes to a qualified domestic trust or the spouse becomes a citizen before the return is filed (section 2056(d)). Third, the distribution: the estate must file Form 1041 whenever a beneficiary is a nonresident alien, withholds on the income it carries out to that beneficiary (section 1441; Treas. Reg. § 1.1441-5(b)(2)) and reports on Forms 1042 and 1042-S. The heir’s own country usually taxes the inheritance on the heir; the estate’s papers are prepared so that the foreign return and any credit can be made.
| Jurisdiction | Estate or inheritance tax | Who may serve as personal representative |
|---|---|---|
| District of Columbia | Estate tax above an indexed threshold (USD 4,873,200 for deaths in 2025); return due within 10 months | No letters to a foreign national without permanent residence; a nonresident files a power of attorney in favour of the Register of Wills |
| Maryland | Estate tax above USD 5,000,000; inheritance tax of 10 percent except for spouses, lineal relatives, siblings and their spouses | A non-citizen only as a permanent resident who is the spouse, ancestor, descendant or sibling; a nonresident with a resident agent |
| Virginia | No estate or inheritance tax | A nonresident with consent to service of process and bond with surety, unless a resident co-fiduciary qualifies |
| California | No estate or inheritance tax | A person not resident in the United States only if named as executor in the will; the court may require bond |
| Federal | Estate tax above USD 15,000,000 (2026), 40 percent; Form 706 within 9 months | Form 1041 required where a beneficiary is a nonresident alien; withholding on distributions |
What has to happen, in order
- Open the estate
Admit the will and obtain letters in the state of domicile; where the named executor lives abroad, arrange the resident agent, the bond or a co-fiduciary the state requires, or a professional fiduciary.
- Secure and value the assets
Date-of-death values for every account, the real estate and the business interests, in the United States and abroad; the step-up in basis follows these values (section 1014).
- Notify and provide for creditors
Publication and the claims period under the state’s statute; the estate’s own creditors before any distribution.
- File the tax returns
The decedent’s final Form 1040, the estate’s Form 1041, Form 706 where the estate exceeds the exclusion or portability is wanted, and the Maryland or District of Columbia return where it applies.
- Settle the spouse’s position
A qualified domestic trust where the surviving spouse is not a citizen, or the spouse’s naturalization before the return is filed; the elective share under state law where the will leaves less.
- Document the heirs abroad
Form W-8BEN or W-9 from each heir before the first distribution; the treaty claim where one is available.
- Distribute and report
Withhold on the income portion, file Forms 1042 and 1042-S, close the estate, and hand each heir the Schedule K-1, the Form 1042-S and the papers for the foreign return.
How the firm helps
The firm’s attorneys are licensed in the District of Columbia, Maryland, Virginia and California and administer estates in all four, or act as counsel to a family member who serves as executor.
- The probate proceeding, from the petition to the final account, including the appointment of a nonresident or a professional fiduciary.
- Form 706, the state estate tax return and the estate’s income tax returns, prepared in the firm’s federal tax practice.
- The qualified domestic trust or the alternatives for a surviving spouse who is not a citizen.
- The withholding, documentation and reporting on every distribution abroad.
- The correspondence with the heirs’ advisers in their own countries, in English, German or French.
What documents to prepare for the initial consultation
- The death certificate
- The will, any codicils and any trust documents
- The latest statements of every bank, brokerage and retirement account, with the beneficiary designations
- The deeds of the real estate and the latest property tax bills
- Documents on business interests: operating agreements, shareholder agreements, recent financial statements
- The decedent’s income tax returns for the last three years, and any gift tax returns
- Life insurance policies and pension statements
- A list of debts, including mortgages and credit cards
- The names, addresses, citizenship and country of residence of the heirs, and the relationship of each to the decedent
Copies are sufficient. The firm sets up a secure portal for the documents and reviews them before the consultation.
The estate tax conventions do not change the taxation of a U.S. domiciliary’s estate, but they decide how the heir’s country relieves the double burden: Germany, for example, credits the U.S. tax against its inheritance tax on an heir domiciled in Germany for property other than the real estate, business property and partnership interests that the convention leaves to the United States (Article 11(3)(b) of the German convention). The income tax conventions set the withholding rate on the income the estate carries out.
Describe the estate in a few lines
The state, the assets and where the heirs live are enough for the firm to say what the administration requires and how it would proceed.
