Costa Rica consistently ranks among the world's most popular retirement destinations for Americans. The country's biodiversity, stable democracy, universal healthcare system, and Pensionado visa program have drawn hundreds of thousands of US citizens — from baby boomers retiring to the Central Valley to digital nomads working from beachside towns in Guanacaste or surf communities around Tamarindo. The American expat community in Costa Rica numbers well into the hundreds of thousands.
But the appeal of Pura Vida can obscure some critical estate planning realities. Costa Rica has its own inheritance laws, a forced heirship system that applies to children's shares, a local will process conducted entirely in Spanish before a notary, and a trust structure (fideicomiso) widely used to hold and transfer property. Meanwhile, as US citizens, Americans abroad never escape the reach of the IRS or the potential application of federal estate tax.
This guide explains what American expats in Costa Rica need to know about wills and estate planning in 2026.
Costa Rica's inheritance law is codified in the Código Civil (Civil Code) and the Código de Familia (Family Code). Like most civil law countries in Latin America, Costa Rica applies the law of the place where the property is situated (lex situs) to real estate and the law of the decedent's last domicile to movable property. For American expats living in Costa Rica, this means:
When there is no valid will (or where a will doesn't cover all assets), the Costa Rican Civil Code distributes the estate as follows:
Costa Rica does not impose a rigid legítima (forced share) as strict as Spanish or French law, but children do have a protected interest. The Civil Code provides that a testator cannot freely dispose of more than 75% of their estate if they have living children. The remaining 25% is reserved as the cuarta de mejoras — effectively a minimum guaranteed share for children. Spouses also have rights that can limit free testamentary disposition when community property (gananciales) is involved.
What does this mean in practice? If you own a beach condo in Tamarindo and a house in the Central Valley, you can leave them to whomever you wish — but if you have children, they have a legal right to challenge any disposition that leaves them less than their 25% minimum share.
Costa Rican law recognises several types of will, but American expats should use the testamento público abierto (open public testament), which is by far the most reliable and enforceable.
This will is executed before a Costa Rican notario público — in Costa Rica, notaries are always licensed lawyers — and three witnesses. The process:
If you do not speak Spanish fluently, the notary must arrange a certified interpreter, and the will must explicitly note that the contents were explained to you in your language. An unregistered, English-language will has no direct legal effect for Costa Rican assets.
Fees for a Costa Rican public testament typically range from $200 to $600 depending on the complexity and the attorney's rates.
One of the most powerful estate planning tools available to American expats in Costa Rica is the fideicomiso — a trust structure under Costa Rican law governed by the Ley Reguladora del Mercado de Valores and the Civil Code's trust provisions.
In a fideicomiso, you (the settlor) transfer your property to a licensed fiduciary (usually a bank or authorised trust company — the fiduciario), which holds the property for the benefit of designated beneficiaries. On your death, the trust assets pass directly to beneficiaries without going through probate.
The major licensed fiduciaries in Costa Rica include Banco Nacional, Banco de Costa Rica, and several private trust companies. Annual management fees typically range from 0.5% to 1% of the trust's asset value.
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Create Your US Will Online →Unlike some countries that only tax residents, the United States taxes the worldwide estate of all US citizens, regardless of where they live or die. This is one of the most important planning considerations for Americans abroad.
The federal estate tax exemption in 2026 remains approximately $13.61 million per individual under current law (doubled under the Tax Cuts and Jobs Act of 2017 and inflation-adjusted annually). Estates below this threshold owe no federal estate tax. Estates above it are taxed at rates up to 40%.
Critical warning: The elevated exemption is scheduled to sunset after December 31, 2025 unless Congress acts. Under pre-TCJA law, the exemption would revert to approximately $5–7 million (inflation-adjusted). For expats with significant property in both the US and Costa Rica, this potential change warrants immediate review with a US international tax attorney.
Costa Rica does not levy a general inheritance tax. There are transfer taxes applicable when real property changes hands (currently 1.5% of the registered value), but these apply at the point of transfer, not as a standalone estate tax. This is a significant advantage for heirs receiving Costa Rican real estate.
The US and Costa Rica do not have an estate tax treaty. This means there is no bilateral framework for avoiding double taxation on an estate. However, given that Costa Rica has no inheritance tax, double taxation is not a practical issue in most cases — the only estate tax owed will be US federal (and potentially state) estate tax.
List your US assets (home, retirement accounts, brokerage, life insurance) and your Costa Rican assets (real estate, bank accounts, vehicles, business interests) separately. Note how each is titled and who appears as beneficiary on retirement accounts and life insurance.
Your US will should cover your US-sited assets. Use a service like USLegalWills or work with a US estate attorney. Confirm that your will is valid in your US state of domicile (the state where you are legally domiciled for tax purposes — often the last state you lived in before moving abroad).
For your Costa Rican real estate and bank accounts, engage a local Costa Rican abogado/notario to draft and register your public testament. Ensure it clearly references and excludes assets covered by your US will to avoid conflicts.
If you own significant Costa Rican real estate and want to avoid a two-year probate process, discuss setting up a fideicomiso with a licensed Costa Rican bank. This is especially valuable if your heirs are US-based and cannot easily travel to Costa Rica to manage an estate.
An online service like ExpatLegalWills helps you think through your cross-border estate systematically and produces a structured document that you can then review with local counsel in both countries.
US retirement accounts (401(k), IRA) and life insurance policies pass by beneficiary designation — not by your will. Ensure these are up to date, name contingent beneficiaries, and consider the tax implications for Costa Rica-resident heirs receiving US retirement distributions.
Americans with more than $10,000 in foreign bank accounts must file an FBAR (FinCEN Form 114) annually. Accounts above $50,000 may also require FATCA disclosure (Form 8938). Your estate plan should account for these reporting obligations and ensure your executor is aware of them.
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Start with ExpatLegalWills →Guanacaste — Costa Rica's Pacific Gold Coast draws American retirees with its dry climate, beach communities, and proximity to Liberia airport. Property values here have risen sharply over the past decade; many Americans hold substantial real estate that requires careful planning.
Central Valley (San José, Escazú, Santa Ana, Heredia) — The most urbanised expat community. More accessible legal services, including international law firms in Escazú that can coordinate a US–Costa Rica estate plan. The largest and most established American expat community lives here.
Tamarindo and the Nicoya Peninsula — Popular with younger expats and digital nomads. Property structures here sometimes include fractional ownership and timeshares, which require specific provision in your estate plan.