An offshore trust might be the best method of protecting assets you’ve worked so hard to achieve. With the various economic and political issues which can create some financial instability both at home and abroad, protecting your wealth against U.S. tax laws, from creditors and legal judgments becomes of tantamount importance.
Keeping your money in the United States in an onshore trust may not be the best vehicle when it comes to mitigating tax liabilities and protecting your investments and other assets from the jurisdiction of a local court.
Offshore trusts are similar to onshore trusts in that they involve a settlor or grantor who transfers the trust assets or property to the trustee for the benefit of the designated beneficiaries. However, there are benefits gained by the settlor in establishing an offshore trust which include:
- Stronger options for accessing your money
- Asset protection while maintaining control over your assets
- Tax planning
- Avoidance of probate
- Deeper level of asset protection
- Avoidance of excessive taxes on property sales and investments.
If you have a retirement account, such as an IRA or 401k, it can be moved completely offshore without creating tax consequences by forming an offshore IRA LLC or if your U.S. defined benefit plan allows for an IRA or 401k conversion.
Establishing an offshore trust as part of comprehensive estate planning combines the benefits of estate planning with asset protection planning.
Offshore Trusts You Can Trust
If you’ve been reconsidering whether keeping your money in the United States offers you the best options for preserving your wealth by protecting your assets, you may want to think about moving your wealth offshore into some type of offshore trust vehicle.
Over the past several years, the U.S. dollar has become valuable against most of the world currencies and, as such, has become the safe haven of choice for investors all over the world. Morgan Stanley Research strategists are predicting a declining dollar, which could have mixed effects for the U.S. economy in the coming years.
While a weak currency can benefit an export-based economy, it also decreases the value of U.S. assets in foreign markets. Coupled with political issues that tend to leave a country’s currency more unstable, a weak dollar could lead overseas investors to doubt the economic strength of the U.S. and reconsider their investments. During periods of economic instability, offshore trusts can be attractive as they allow for portfolio diversification and protection of your assets in the event of a financial crisis.
A Solution to Consider
Anyone can invest in an offshore trust as long as they have assets to protect and the resources needed to afford the trust. It can prove very beneficial if you want to preserve your wealth against any financial and/or political instability in the U.S.
If the question is should you keep your money in the United States, the Jeffrey M. Verdon Law Group offers comprehensive estate planning services, incorporating the standard of care for estate plans with the added layers of protection offered by advanced estate planning structures such as offshore trusts.
Contact JMV Law, with offices in Newport Beach and Redwood City, California.