@sarahyang108
Assuming that the total value of your parents-in-law is less that approx. US$13 million, there is no estate tax and therefore no need to file a form 706. Since the prop. was inherited by your husband in 2020 ( at the passing of his father ) , I am assuming that he did get a valuation of the asset. This value would be his "basis" in the asset and with no step-up at the passing of his mother in 2025 ( since she was no longer an owner / not on the title ). When he sells the prop. the gain would be taxable foreign source capital gain and taxed as such. How is the prop. being used in the meantime? Note that any income generated by the asset needs to be recognized for US tax purposes. Which country is it in ( for foreign tax and tax treaty purposes )?
My ref. for this is : form 706 instructions --> Instructions for Form 706 (Rev. September 2025) ---- page 2
Statute --IRC -- section 2201 thru 2801 ---> 26 U.S. Code Subtitle B - Estate and Gift Taxes | U.S. Code | US Law | LII / Legal Information Insti...
Is there more I can do for you ?
pk
