Foreign Trust Structures

Protecting your assets from creditors and other entities can be done very effectively with a foreign trust. Naturally, to be most effective, you need to have a clear understanding of how domestic and foreign laws will affect the transfer of funds, structure of the trust, and management of wealth overseas.

Experienced international asset protection lawyers can help you set up a trust that will be both tax efficient and wholly compliant with international laws. Hart David Carson is here with the legal experience necessary to help you protect assets overseas.

Asset Protection

People may regard keeping assets overseas as highly suspect, but that is only really true if it is done illegally. Foreign trusts are a perfectly legitimate way to protect your wealth from unlawful seizure, whether that’s from a vengeful ex-spouse or unwarranted bureaucratic action.

Normally, trusts set up an extra layer of security for your assets by placing them outside of your control in specific ways. In other words, in the eyes of the law, assets in a trust do not technically belong to you. Therefore, they are safe from lawsuits (they can’t take what doesn’t belong to you) and certain tax laws (they can’t tax you on what isn’t yours either). Of course, it’s much more complex than that, which is why having an attorney on board with creating a foreign trust is so important.

With a foreign trust, the security of your assets increases in that it is much more difficult for creditors to pursue litigation against it. While you will still need to report on your foreign trusts to the IRS annually, they are much more secure from the prying eyes of those seeking to take away your wealth.

Structuring a Foreign Trust

In order to be legally considered a foreign trust, it must be designed a certain way. If a domestic court can control its administration, or if U.S. fiduciaries can control major decisions with respect to the trust, then it must be considered a domestic trust, not a foreign one. Having our attorneys on board will help you ensure that your trust meets the needed criteria.

Effective Planning is Key

In addition to structuring a trust so that it functions under a foreign jurisdiction, its design must take into account a number of other factors. Otherwise, it may end up being a wasted effort. You need to analyze such factors as:

• Economic, social, and political stability of the foreign country
• The extent of their legal history (i.e., how well established their laws are)
• Banking and communications technologies, especially those used in maintaining trusts
• The integrity of their government
• Domestic regulations on transfer of funds and reporting requirements

Making sure the trust operates well within the jurisdiction of the foreign entity as well as under U.S. laws is a process steeped in regulatory complexity. At Hart David Carson, our attorneys can help you structure your foreign trust in a way that is consistent with U.S. laws and regulations. In addition, we can assist with tax planning, annual reporting, and other issues central to using a foreign trust structure. 

For a free consultation, contact the international asset protection attorneys at Hart David Carson today.