Married to a French Citizen? The US Estate Tax Trap for Non-Citizen Spouses

American estate plans are built on one assumption: whatever you leave your husband or wife passes free of federal estate tax. That assumption depends on your spouse holding a US passport. For the US estate tax, a non-citizen spouse in France is treated differently from an American one, in four places: the transfer at death, gifts between you while alive, jointly held accounts and homes, and a return that has to be filed on time. The relief exists. It is not automatic. This article is for informational purposes only and is not tax or legal advice; consult a qualified cross-border tax professional before making any filing decision.

Does the IRS tax everything I leave my French spouse?

Under 26 CFR 20.2056A-1, the federal estate tax marital deduction is not allowed for property passing to a surviving spouse who is not a US citizen at the date of death, whether or not that spouse lives in the United States. A green card does not change the answer. Neither does a 30-year marriage. The test is citizenship, on one date.

That does not mean a tax bill. Your own exclusion still applies, and the IRS sets the Form 706 filing threshold at $15,000,000 for deaths in 2026. An American whose worldwide estate, plus the taxable gifts made during life, stays under that line owes no federal estate tax whoever inherits. Worldwide is the word to hold on to: the French apartment, the US brokerage account, the IRA and the life insurance you own are all counted.

Where the damage actually happens

The exposure sits in three places, and only the first depends on being wealthy.

• Above the exclusion, every dollar left to a non-citizen spouse is taxable at the first death unless the executor elects the treaty deduction or a qualified domestic trust. Between two Americans the same dollars would wait until the second death.

• Below the exclusion, couples still trip the gift rules. Transfers between spouses are capped each year when the recipient is not a US citizen, and the French tax-free band between spouses is smaller still.

• At any size, jointly titled property is presumed to belong entirely to the first spouse to die, which can push a modest estate over the filing threshold on paper and consume exclusion that the family wanted to keep.

Each of the reliefs below is claimed on a return. An estate that files late, or not at all because nobody thought a return was due, can lose a relief it was entitled to.

Which shelter applies to your estate, line by line

Four tools cover a transfer to a non-citizen spouse in 2026: the $15,000,000 exclusion, the treaty deduction, the QDOT and, rarely, the survivor's naturalization. Which one applies depends on the size of the American spouse's estate and on who dies first. Read across the row that matches you.

The last row is the one people hope for and rarely get. A widow or widower who keeps living in France fails the US residence condition, so naturalizing after the death does not reopen the deduction.

The treaty deduction, and the election that switches it on

Article 11(3) of the US-France estate and gift tax treaty, added by the protocol signed on 8 December 2004, gives the estate a marital deduction equal to the lesser of the value of the qualifying property and the applicable exclusion amount in force at the date of death, computed without regard to gifts the decedent made earlier. For a death in 2026 that cap is $15,000,000, and it comes in addition to the decedent's own exclusion. The treaty is listed on the IRS estate and gift tax treaties page and the consolidated French text is published by impots.gouv.fr.

Who qualifies

Qualifying property means property that would have earned the ordinary marital deduction had the surviving spouse been a US citizen, with every election properly made. An outright bequest qualifies. Three conditions then apply.

1. At death, the decedent was domiciled in France or in the United States, or was a US citizen.

2. The surviving spouse was domiciled in France or in the United States.

3. If both spouses were domiciled in the United States, at least one of them was a French national.

An American living in Lyon with a French wife meets all three.

What the election costs

The price is in the next clause of Article 11(3): the executor must elect the treaty benefit and irrevocably waive any other estate tax marital deduction on the federal return, within the time allowed for a QDOT election. Treaty or trust, never both. Where the estate exceeds the exclusion by less than that cap and goes outright to the spouse, the treaty is the simpler road and avoids a trust altogether. Beyond it, the waiver costs something real and the choice needs modelling before anything is filed.

French law adds its own constraint on what "left outright to the spouse" can mean. Children hold a reserved share that a will cannot remove, a subject covered in our guide to forced heirship and the Brussels IV election. Only what the spouse actually receives can be deducted.

When a QDOT is the only tool left, and what it demands

Under 26 USC 2056A, a qualified domestic trust restores the marital deduction for a non-citizen spouse when at least one trustee is an individual US citizen or a domestic corporation, that trustee has the right to withhold the QDOT tax from any distribution of principal, and the executor elects QDOT treatment on the estate tax return. The election is irrevocable. The statute bars it on any return filed more than one year after the due date, extensions included.

What the trust has to look like

26 CFR 20.2056A-2, as amended in July 2026, adds the practical layer. The trust must be maintained under the laws of a US state or the District of Columbia. An individual US trustee must have a tax home in the United States, which rules out the American brother-in-law who also moved to Bordeaux. If the will left everything outright, the surviving spouse can still transfer or irrevocably assign the property to a QDOT before the return is filed, so an estate with no planning at all is not yet lost.

The $2,000,000 line and the French house

Security depends on size. Where QDOT assets exceed $2,000,000, the trust must at all times have a US bank as trustee, or post a bond or a letter of credit in favor of the IRS equal to 65 percent of the trust assets. At $2,000,000 or less, the trust instead promises that no more than 35 percent of its value, measured each year, is real property outside the United States, or it accepts one of the three security arrangements anyway.

For a couple whose main asset is a home in France, that 35 percent test is the obstacle. The regulation lets the executor exclude up to $600,000 of a personal residence when measuring the $2,000,000 threshold and the size of the bond, and states that the exclusion does not apply to the 35 percent foreign real property test.

What is taxed later

A QDOT defers the estate tax. It does not cancel it. Income paid to the spouse is free of the QDOT tax. Distributions of principal are taxed as if they had been part of the first estate, except on account of hardship, and whatever remains is taxed at the surviving spouse's death. Tax on a lifetime distribution is due on the 15th day of the fourth month after the calendar year, reported on Form 706-QDT, and each trustee is personally liable for it.

There is a French side to the same structure. A QDOT is a trust held for a surviving spouse who lives in France, and our article on how French tax law treats a US trust at death explains why a deed that keeps assets in trust for a spouse's lifetime is the costly design there. Both analyses have to be run before one document is signed.

None of this is a do-it-yourself job, and no tool drafts a trust. What a couple can do alone is place the estate review inside the calendar of the move: the France Navigator maps the cost and timeline of relocating, from visa to residency, so the meeting with a US estate attorney lands before the dates that cannot be moved.

Gifts between you: $194,000 a year for the IRS, 80,724 euros for France

The IRS caps tax-free gifts to a spouse who is not a US citizen at $194,000 for 2026, up from $190,000 for 2025, and only gifts of a present interest count. Between two Americans there is no cap. With a French spouse, retitling the brokerage account in both names, or funding a house that sits in the spouse's sole name, is a gift measured against that figure. The excess is a taxable gift: it goes on a US gift tax return and is added back when the IRS measures the estate against the filing threshold.

Rebalancing by annual gifts is the simplest way to shrink the American spouse's estate, because what a French spouse with no US citizenship and no US domicile owns outright escapes US estate tax, apart from the US-located assets described further down. The French limit arrives first, though. For donors taxed in France, impots.gouv.fr sets the allowance between spouses at 80,724 euros, usable once every 15 years on its page updated 13 July 2026. Above it the French progressive scale for gifts between spouses applies, and the recipient has to declare the gift online within the month that follows. A transfer of $194,000 can be free in Washington and taxable in Paris.

Joint accounts and jointly titled homes: the 100 percent presumption

Under 26 CFR 20.2056A-8, when the surviving spouse is not a US citizen, the rule that treats spouses as half owners of joint property does not apply: the entire value of property held as joint tenants with right of survivorship is included in the estate of the first to die, unless the executor shows what the survivor paid for. The regulation gives an example in which the survivor proved 40 percent of the deposits into the joint account that bought the home, and 60 percent was included.

The practical lesson is about records. In practice, couples who pool everything into one account cannot reconstruct 15 years of contributions after a death. Keep the French spouse's salary, inheritances and sale proceeds traceable, and keep the statements. The rule targets survivorship titling, which is how US banks and brokers commonly open joint accounts. It is a different thing from the French marital property regimes a notaire will describe, so tell each advisor how every asset is titled and in which country.

If your French spouse dies first

Article 8 of the treaty reserves the taxation of shares, debts, cash and other intangible property to the country where the decedent was domiciled or held citizenship, so a French spouse with no US citizenship and a French domicile is outside US estate tax on a portfolio of US stocks. US real estate, the assets of a US business and tangible property located in the United States remain taxable there under Articles 5 to 7, with a unified credit prorated to the US share of the estate under Article 12(3). The IRS explains in its estate tax FAQ that the claim is made on Form 706-NA with a statement naming the treaty.

What then passes to you, the American survivor, qualifies for the ordinary marital deduction because you are a US citizen. It also enlarges your own worldwide estate, which is the one the IRS will measure against the exclusion later.

Where binational couples lose the deduction they thought they had

US wills signed before the move usually leave everything outright to the spouse and say nothing about citizenship, because in most American marriages it never matters. In practice, a domestic will template assumes the unlimited deduction and the executor finds out when Form 706 is prepared. A will written in Ohio for a wife who is French needs a QDOT fallback clause or a deliberate decision to rely on the treaty, recorded somewhere the executor will find it.

French notaires typically handle the French succession and stop there. The rule says the US return is the executor's responsibility. What happens in practice is that the French succession gets settled while nobody has asked whether a Form 706 is due in the United States at 9 months. The treaty deduction and the QDOT both exist only as elections on that return, so a family that discovers the US filing two years later may find both doors closed.

Retirement accounts are the third blind spot. A traditional IRA or 401(k) counts in full toward the $15,000,000, and the beneficiary form, not the will, decides who receives it. The income tax side is covered in our guide to keeping a 401(k) or IRA after moving to France.

Before you sit down with an estate attorney

Add up the American spouse's worldwide estate at today's values, joint assets at 100 percent, and compare the total with $15,000,000.

Well under that line, a couple can handle this without a trust: keep contribution records for joint property, keep gifts to the French spouse within both limits, and tell whoever would act as executor that a US return may be due. Near or above it, this is not a solo project. The treaty election and the QDOT exclude each other, the choice is irrevocable, and it interacts with forced heirship and with French trust rules, so it needs a US estate attorney and a notaire who are willing to speak to each other. The wider money picture of the move is in our money map for Americans relocating to France.

Bring numbers to that first meeting, because cross-border advice is billed by the hour in two countries. The Navigator's cost and IFI estimates price the move itself and your French real estate against the wealth tax scale, which gives you the property figure both advisors will ask for before anything else.

FAQ

Does a PACS partner count as a spouse for the US marital deduction?

No. The IRS states in its estate and gift tax FAQs that the terms spouse, husband and wife do not include a registered domestic partnership, civil union or similar relationship that is not called a marriage. A PACS partner gets neither the marital deduction, nor the treaty deduction, nor the $194,000 gift exclusion. The immigration side of the same choice is compared in PACS versus marriage for a binational couple.

Can my spouse solve this by becoming a US citizen after I die?

Only in a narrow case. Under 26 CFR 20.2056A-1(b), the survivor is treated as a citizen at the date of death if citizenship is acquired before the estate tax return is filed and the survivor was a US resident at all times after the death. A spouse who stays in France fails the second condition, so the planning has to happen while both of you are alive.

Does France tax what my spouse inherits from me?

No. BOFiP, the official commentary of the French tax administration, states that Article 796-0 bis of the Code général des impôts exempts the surviving spouse and the surviving PACS partner from all succession duties, a rule in place since the law of 21 August 2007. The exemption covers tax only. It does not change who inherits under French succession law.

Will the $15,000,000 figure still apply when it matters to us?

The figure belongs to the year of death. The IRS table of filing thresholds rises from $5,000,000 for 2011 to $13,990,000 for 2025 and $15,000,000 for 2026. The treaty deduction follows it, because Article 11(3) refers to the applicable exclusion amount under US law at the date of death. A plan should be tested against a lower number as well as the current one.

Does a QDOT that owns our French home have extra filings?

Yes. Under 26 CFR 20.2056A-2(d)(3), when a QDOT directly owns real property outside the United States and has neither a US bank trustee nor a bond or letter of credit, the US trustee files Form 706-QDT with a statement listing every trust asset and its value, by April 15 of the following year. A late statement can expose the trust to the anti-abuse rule, under which QDOT status ends.