October 21, 2024

For several decades, there have been strong U.S. tax reasons to keep a foreign trust offshore so that there’s reduced tax friction on the current earnings of the trust, thereby enhancing overall family wealth outside the U.S. tax net. Unfortunately, both U.S. practitioners and beneficiaries tend to underestimate the magnitude of compounded tax savings available offshore, leading them to erroneously assume that once accumulated offshore, tax-efficient access to wealth becomes unattainable.
However, if certain longstanding, time-limited foreign trusts continue onshore after accumulating income for eventual distribution to U.S. beneficiaries, the trustee will face serious problems. Let’s explore a few strategies to mitigate this dilemma.
Bac...
Unlock All Access Premium Subscription
Get Trusts & Estates articles, digital editions, and an optional print subscription. Choose your subscription now and dive into expert insights today!
Already Subscribed?