Foreign Offshore Trust Lawyers
A Foreign Asset Protection Trust is a trust that is set up in an offshore jurisdiction that has enabling trust legislation providing for substantial protection against creditors of the trustors. The biggest advantage of the Foreign Asset Protection Trust is the fact that, by its very nature, any legal attack against the assets in the trust is transferred abroad to a different legal system. The Foreign Asset Protection Trust is generally much more expensive to set up and create than a Domestic Trust and requires a certain willingness on the part of the trustor to deal with offshore jurisdictions and trust entities.
Creating offshore trusts is complicated and requires careful legal planning for the transfer of assets. In California, the law considers the transfer of assets to be fraudulent if the assignment is done because of a “pending, threatened, or claimed” liability–such as the filing of a lawsuit.
An offshore trust is different from a regular U.S. based trust in that the trust is set up offshore in a foreign jurisdiction. This means that the trust isn’t under the authority of U.S. tax law.
Where do we locate offshore trusts?
While Switzerland and Liechtenstein are incredibly popular offshore trust holders, we at prefer to work within the jurisdictions of the Cook Islands off the coast of New Zealand.
Our long standing and trusted relationship with the legislative body of the Cook Islands allows us to set up and maintain offshore asset trusts that will greatly benefit our California business clients in their efforts to create a secure and risk-free financial future for their business.
The benefits and features involved in adopting the Cook Islands as the domiciliary of our trusts include our outstanding relationships and connections with well-respected and professionally operated offshore trust companies.
Another benefit to adopting the Cook Islands as the domiciliary of our trusts is the excellent local legislation in respect to its protection of creditors. The geographical location of the Cook Islands allows for easy face to face communication when necessary.
Do you have questions regarding the benefits of offshore trusts; what they are, how they work, and how to get started?
How do we integrate offshore trust planning with tax planning?
Most of our clients ask us to move assets from revocable living trusts to irrevocable trusts in order to reduce tax exposure. We can locate the irrevocable trust in the United States or elsewhere. The jurisdiction question involves the complex interaction of competing legal guidelines.
For example, the rule against perpetuities limits the length of time in which the trust funds must be distributed. This creates risks that could allow the trust to be dissolved due to hypothetical, unrealistic circumstances that might infringe upon the ‘rule’. Offshore trust jurisdictions are not subject to the US rule against perpetuities and therefore can offer lengthier, often fixed, perpetuity periods to Settlors (an individual who settles property on trust law for the benefit of another).