On February 28, 2020, the French-American Bar Association (FABA) held a conference in Paris dedicated to the tax structuring of real estate investments in France and the United States, approached from a comparative and cross-border perspective. The event took place at the Maison du Barreau de Paris, in the Gaston Monnerville room, and brought together legal and tax professionals dealing with international real estate matters.
In a context of increasing mobility of individuals and capital, real estate represents a key vehicle for investment and wealth transmission. However, the significant differences between the French and U.S. legal and tax systems make it essential to carefully analyze investment structures in order to anticipate the civil, tax and reporting consequences associated with such transactions.
The conference opened with a presentation of the main methods for acquiring real estate in France. The speakers addressed direct acquisitions, highlighting in particular the mechanism of gifts of bare ownership, as well as acquisitions structured through a split ownership arrangement. Structures involving the acquisition of property through a French civil real estate company (SCI), followed by the donation of shares in bare ownership for estate planning purposes, were also examined.
The discussion then focused on the acquisition of U.S. real estate by non-residents. The general rules applicable to U.S. tax residents and non-residents were outlined, before turning to real estate investments made in the United States by non-resident investors. In this context, the speakers analyzed the taxation of rental income and capital gains, as well as the tax consequences arising in the event of gifts or successions.
Particular attention was also paid to the reporting obligations related to the ownership and transfer of U.S. real estate, as well as to the specific issues raised by the receipt of bare ownership under U.S. law. These practical and often complex issues represent key areas of concern for practitioners advising international clients.
The conference featured three speakers with complementary expertise. Ms. Virginie Marrer, an attorney admitted to the Paris Bar with over thirty years of experience in French and international tax law, spoke on the tax structuring of real estate investments and wealth transmission strategies. Ms. Hélène Peisse, a notary and partner at the Ducamp-Monod firm, specializing in private international law, provided a notarial perspective on acquisition structures and succession planning in cross-border situations. Ms. Fanny Karaman, specialized in U.S. and international tax law, presented the U.S. tax rules applicable to real estate investments and the specific challenges of Franco-American cross-border taxation.
Welcomed with a breakfast, participants had the opportunity to engage with the speakers in a setting conducive to professional exchange. Accredited as part of mandatory continuing legal education for attorneys, this conference was fully aligned with FABA’s mission to promote understanding of transatlantic legal and tax issues.