If you live in the San Jose area, there’s a good chance you’ve seen this exact scenario: Your parents bought a beautiful home in Willow Glen, North San Jose, or Cupertino back in the 90s or early 2000s. They raised the family, built a life, and then, eventually, decided to move back to Taiwan to enjoy their retirement years closer to extended family (and let’s be honest, the amazing food).
But they kept the house.
Maybe it’s a rental property now, or maybe it’s the place they stay when they come to visit the grandkids. On paper, it’s a brilliant investment. San Jose real estate is legendary for its growth! But from a legal and estate planning perspective? It can be a ticking time bomb if you aren't careful.
When your parents live in Taiwan but own real estate in California, they are navigating two very different legal systems. If something happens to them, you: the adult child living here in the States: are often the one left to figure out the mess.
Let’s talk about why this "simple" house ownership can get complicated, and how we can protect your family’s hard-earned legacy.
The "Stealth" Probate: Why Your Parents’ Distance Matters
Most people know that probate is something to avoid. In California, if you pass away owning a home in your individual name (and it’s worth more than a very small threshold), that home has to go through a court process called probate before it can be passed to the heirs.
That’s why living trust planning matters so much for families like yours. A properly set up (and properly funded) California Living Trust is the cleanest way to keep that San Jose house out of court—so your parents can enjoy retirement in Taiwan with real peace of mind knowing their U.S. assets are already handled.
For a local family, probate is already a slow, expensive headache. But for a family where the owners live in Taiwan? It becomes a logistical nightmare.
Think about it:
- Court Appearances: Everything has to happen in a California court.
- Document Authentication: Getting legal documents signed in Taiwan and "apostilled" or authenticated for use in a U.S. court is a multi-step process that involves the Taipei Economic and Cultural Representative Office (TECRO).
- Time Zones: Your lawyer is in San Jose; your parents’ documents (and perhaps their other assets) are in Taipei. The 15-hour time difference alone can add weeks to a process that already takes over a year.
If the house is just in your parents' names, the California court won't care that they are in Taiwan. The court will lock that property down until the probate process is finished. That means you can’t sell it, you can’t refinance it, and you may even have trouble managing the rental income.
The Giant Tax Trap You Didn't See Coming
This is the part where I usually see clients’ jaws drop.
We all hear about the "Estate Tax Exemption" in the United States. For 2026, for U.S. citizens, that exemption is quite high (though it may change!). Most American families don't have to worry about the federal estate tax unless they are worth tens of millions of dollars.
However, the rules for "Non-Resident Aliens" (people who are not U.S. citizens and do not live here) are completely different.
If your parents are living in Taiwan and are not U.S. citizens, their federal estate tax exemption for U.S.-based assets (like that San Jose house) is only $60,000.
Read that again. Only $60,000.
In the San Jose market, even a modest condo is worth $800,000, and a single-family home is easily $1.5M to $3M. If the house is worth $1.5 million, and your parents pass away, the IRS could potentially look for estate taxes on almost the entire value of the home. The tax rate starts at 18% and climbs quickly to 40%.
Without a plan, your family could be writing a check for hundreds of thousands of dollars to the IRS just to keep the house your parents already paid for.
FIRPTA: The Seller’s Surprise
Maybe your parents aren't planning on passing away anytime soon (we hope!), but they are thinking about selling the house. This is where FIRPTA (the Foreign Investment in Real Property Tax Act) comes in.
Because your parents are non-residents, the IRS wants to make sure they get their cut of the capital gains before the money leaves the country. When a foreign person sells U.S. real estate, the buyer is actually required by law to withhold 15% of the total sales price and send it directly to the IRS.
On a $2 million San Jose home, that’s $300,000 taken right off the top at the closing table. While your parents might be able to get some of that back later by filing a U.S. tax return, losing that much liquidity in an instant can ruin their retirement plans or their ability to buy a different property.
Why a Dual-Licensed Attorney is Your Secret Weapon
You might be thinking, "I'll just find a lawyer in San Jose to write a Trust." Or, "My parents have a lawyer in Taiwan."
The problem is that a California-only lawyer might not understand how a U.S. Living Trust interacts with Taiwan’s inheritance laws or tax reporting requirements. Conversely, a Taiwan-only lawyer won't have the authority or the specific knowledge to handle California real estate deeds or San Jose probate court.
At SC Law Services, Shihlan Chen is uniquely positioned to bridge this gap. As an owner-attorney who is licensed in both California and Taiwan, she understands the "language" of both legal systems: both literally and figuratively.
We don't just look at the house in San Jose; we look at the whole picture. How does the California Trust affect your parents’ taxes in Taiwan? How do we ensure that the documents we create here won't cause a conflict with their Taiwanese will?
Working with someone who understands both sides is the difference between a plan that works and a plan that creates a cross-border legal feud. You can learn more about how we are different and how our team handles these complex cases.
So, What Should You Do Now?
If your parents are in Taiwan and own property here, don't panic! There are very effective ways to handle this. Here is a basic roadmap of how we usually help families like yours:
- Create a California Living Trust (and fund it): This is the #1 tool to keep the San Jose house out of probate court. By transferring the title of the house into a Trust, the property can pass to you (the kids) without a judge getting involved. And for parents living in Taiwan, that’s huge—because it means their U.S. home can be handled in a clear, private, and organized way even if you’re coordinating everything from across the ocean.
- Coordinate with Taiwan Estate Plans: We make sure the "U.S. Plan" and the "Taiwan Plan" are talking to each other. This prevents a situation where two different sets of laws are fighting over the same assets.
- Plan for the Estate Tax: Depending on the value of the home, we might look at different types of ownership or insurance strategies to offset that $60,000 exemption limit.
- Build in overseas-friendly incapacity protection: This is the part most families don’t think about until there’s an emergency. If your parent becomes incapacitated while living overseas (stroke, dementia, accident), you don’t want to be scrambling to prove authority to banks, tenants, or escrow—especially if court involvement is required. With the right trust-based planning (and the right supporting documents), we can help make it much easier for you to step in and manage the San Jose property from here, without the major hassle of trying to navigate an incapacity situation across borders.
Let’s Protect the Family Legacy
Your parents worked hard to buy that home in San Jose. It represents years of sacrifice and a foundation for your family’s future. Whether you are married with children yourself or are navigating this as an individual, protecting that asset is one of the best things you can do for your family's financial health.
At SC Law Services, we love helping families navigate the "in-between." We know that your life doesn't stop at the border, and your legal protection shouldn't either. We want to be your family’s lawyer for life, helping you navigate the complexities of cross-border living with a friendly, supportive hand.
Ready to stop worrying about the "what ifs"?
- Step 1: Check out our 3 levels of planning to see what fits your family best.
- Step 2: Look at how to get started with our firm.
- Step 3: Schedule online for a consultation so we can look at your parents' specific situation.
Owning a home in San Jose while living in Taiwan is a great investment, but it requires a modern approach to estate planning. Let's make sure that house stays a blessing for your family, not a legal burden. We’re here to help you get it right!