If you hear the words “offshore trust” and the first thing that comes to mind is that scene in The Wolf of Wall Street where the stockbrokers are taping cash to the body of their drug dealer’s wife because she has a Swiss passport, you are not alone. A lot of people in the Brandon, Mississippi area have this idea that offshore trusts are shady enterprises run by shady people.
That might have been true in the past, but the modern use of offshore trusts (and even trusts set up in other states) is more about protecting assets from creditors and providing extra privacy and than it is about facilitating illicit transactions.
The Palmer & Slay team is working with a growing number of high net worth individuals and families from the Magnolia State who are interested in taking advantage of the cutting edge trust laws being adopted in other states and countries.
Benefits of Offshore Trusts
The popularity of offshore trusts is growing for a somewhat ironic reason. When the Panama Papers, Pandora Papers, and other leaked documents revealed how many celebrities, athletes, business owners, and other wealthy individuals are using offshore trusts to shield assets, people who aren’t yet using these trusts started to wonder what they were missing out on.
The answer is threefold:
- Privacy — Offshore trusts appeal to people who value their privacy and seek the security that comes from keeping their personal affairs out of the public eye. This is why many well-known or wealthy individuals choose to use foreign trusts to purchase real estate, yachts, or private jets.
- Protection from Creditors — If someone is successfully sued and ordered to pay restitution, the assets they hold in an overseas trust are often unreachable. The first layer of protection comes from the privacy offered by the trusts. The second from the fact that the party that sued must be willing to file a second lawsuit in the country where the trust is located and jump through a number of other legal hoops.
- Investment Opportunities — Investors looking to diversify their portfolio may find setting up a trust to be beneficial. Offshore trusts can be used to gain easier access to global financial markets or qualify for incentives that are tied to holding assets in a certain location.
Getting the Benefits of Offshore Trusts Closer to Home
Of the three reasons for setting up an offshore trust discussed above, the privacy they offer is their biggest selling point. Seeing this and noticing the federal government’s attempts to discourage United States citizens from shifting assets overseas, a number of states have modified their trust laws to provide some of the same privacy protections as popular offshore havens.
Delaware, South Dakota, and Alaska have become popular states that set up trusts to hold assets that might have previously been sheltered overseas. This practice is becoming so popular that foreigners have started to park their assets here. It turns out the right place to set up a trust depends on the law, not the locale!
Preserving Your Wealth. Protecting Your Loved Ones.
Depending on your financial situation, goals, and stage of life, an offshore trust may provide the benefits you need to meet your wealth preservation and estate planning goals.
Palmer & Slay’s experienced team of attorneys is ready to discuss your unique needs and work with you to figure out how to meet them… all without taping loads of cash to your body and heading to the Alps! If you are ready to get started, please contact us today to schedule a meeting.