Even if you are not a US citizen, if you have a family member who is involved in a Canadian family-owned business and is:
Traditional Canadian wills and estate and tax planning may not be effective. In the situations outlined in this Tax Insights, standard Canadian planning techniques could result in significant additional tax.
If you implemented an estate freeze, some or all of the growth in the value of your company accrues for the benefit of your family. This is usually achieved by having your spouse and children own shares of your company, either directly or through a family trust.
However, if any of these family members is or becomes a US citizen or resident, you may be faced with the following tax consequences:
If the shares are owned by a Canadian family trust, US income tax may apply to distributions from the trust to the US family member, even if the trust has already been taxed in Canada on the income. An additional tax or interest charge may apply if the trust has been accumulating income and capital gains.