Australia: Estate, Gift Tax and Probate for New York Assets

Is there a U.S. estate or gift tax treaty?

Australia is on the IRS list of countries with a U.S. estate and gift tax treaty (IRS: Estate and gift tax treaties (international)). A treaty like this can change which country gets the first right to tax certain property, how an asset's location is decided, and which credits may be available. The same estate can come out differently than under the default U.S. rules.

Whether the treaty helps depends on facts such as domicile, citizenship and the type of asset. Under many of these treaties, the country where real estate sits keeps the right to tax it, so a treaty seldom removes U.S. tax on New York real estate. A treaty position generally must be disclosed on the U.S. return. Your tax adviser decides whether and how to claim it.

U.S. and New York taxes on New York assets

If you are not a U.S. citizen and not domiciled in the U.S., U.S. estate tax generally applies only to assets situated in the U.S. The IRS lists U.S. real estate, tangible property located in the U.S., and certain intangibles such as stock in U.S. companies. It treats some property as outside the U.S., such as bank accounts not used in a U.S. business and certain life insurance proceeds (IRS: Estate tax FAQs for nonresidents who are not U.S. citizens). The filing threshold for nonresidents is far lower than for U.S. citizens.

U.S. gift tax generally applies to a nonresident's gifts of U.S. real estate and tangible property located in the U.S. (IRS: Gift tax FAQs for nonresidents who are not U.S. citizens). At death, New York estate tax can separately apply to a nonresident's New York real estate and tangible property located in New York, if that property is part of the estate for estate tax purposes (Tax Law 960(a)). In figuring that tax, New York generally leaves out intangible property such as bank and brokerage accounts (Tax Law 960(b)). When New York real estate is sold, federal FIRPTA withholding may also apply (IRS: FIRPTA withholding on U.S. real estate sales). Your tax adviser handles the returns.

New York probate when the owner lived in Australia

If a written will has been admitted to probate at the owner's domicile, or established under the law there, the New York Surrogate's Court can admit it in an ancillary proceeding for New York property. If the will can still be contested there, New York also requires proof that it is not being contested (SCPA 1602). In some cases, subject to the requirements and exceptions of SCPA 1605, New York may instead admit the will in an original proceeding. A home-country fiduciary may also be able to designate a New York ancillary administrator (SCPA 1608).

A will is generally valid in form in New York if it was signed under New York law, under the law of the place where it was signed, or under the law of the owner's domicile (EPTL 3-5.1(c)). A person not domiciled in New York at death may elect, in the will, to have New York law govern the disposition of property located in New York (EPTL 3-5.1(h)). A noncitizen who is not domiciled in New York generally cannot receive letters as executor or administrator unless the person serves with at least one co-fiduciary who lives in New York. The statute's separate exception is for a qualifying foreign guardian and is not a general executor exception. Any appointment is up to the court (SCPA 707(1)(c)). New York property that has been properly transferred into a funded lifetime trust can often stay out of probate. Whether a trust is right depends on your family and the other country's rules.

Read more: Ancillary probate in New York and Foreign estate with New York assets.

Children in New York, trusts and heirs abroad

If your children or grandchildren live in New York, a New York will can name a guardian for minor children and set up trusts for them. A U.S. person who receives a large gift or bequest from a foreign person, or a distribution from a foreign trust, may have IRS reporting duties (IRS: About Form 3520 (foreign gifts and trusts)). Their tax adviser handles that filing.

A New York court may direct that money or property due a beneficiary be paid into court if it appears the beneficiary would not have the benefit, use or control of it, or if other special circumstances make withholding it desirable (SCPA 2218). This applies to any beneficiary, not only heirs abroad. Some countries do not have trusts in their own law. Counsel abroad should confirm how a New York trust will be treated there.

Notes for Australian families

• Australia is on the IRS list for both estate and gift tax treaty provisions.
• Australian advisers should check how a U.S. trust or estate distribution is treated in Australia.

What to bring to your Free Consultation

• A list of New York and other U.S. assets and how each one is titled: deeds, co-op shares, brokerage and bank statements.
• Any existing wills or trusts, from New York and from abroad, with English translations if you have them.
• Passports or other proof of citizenship and residence for each owner, and any U.S. visa or green card.
• If someone has died: the death certificate, any foreign probate or succession papers, and the names and addresses of all heirs.
• Contact details for your advisers abroad and your U.S. tax adviser, if you have one.

Not sure what applies? Try the cross-border document checklist or which questions apply to me.

Our role

Schwartsman Law Group practices New York law, and our attorneys are admitted only in New York. We handle the New York side: wills and trusts for New York assets, New York probate and ancillary probate, guardianship and asset titling. We do not advise on the law of Australia. Where that law matters, we coordinate with your counsel there and with your tax advisers.

Every family's facts are different, and this page is general information, not legal advice. To talk about your New York assets, call (212) 518-3868 or request a Free Consultation.

Helpful links

Official links checked November 9, 2026. Treaty lists and rules change, so check the current IRS page before relying on any treaty.