Do I need to pay estate tax in USA when using IBKR for trading in LSE?

US estate tax is levied on US situs assets. These include US-domiciled securities (including US-based global ETFs), property and other forms of assets. One notable exclusion is cash in bank accounts, but strangely enough cash in brokerage accounts are considered as US situs assets and are thus taxable.

If you invest in securities domiciled outside of the US, then they are not subject to US estate tax. These also include Irish-domiciled global ETFs listed on European exchanges that invest into US markets, and foreign ADRs listed on US exchanges. Your choice of broker does not matter as much as what you are planning to invest in.

Estate tax is only levied upon death, and for nonresident aliens the exempted amount is 60,000 USD. The tax can range from 18% to 40%. Proper planning can mitigate the impacts of estate tax. You may want to consult with a trusted tax advisor and your broker to find out more. This does not constitute as tax or legal advice.