Law Offices - Kenneth D. Sisco, Attorney - Personal Information
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Last Updated: July 6, 2008 E-Mail -- protect@action-assetprotection-services.com
OFFSHORE PLANNING SEMINAR -- Intensive examination of offshore planning and Asset Protection Techniques. DETAILS
CLICK HERE for The Ultimate Asset Protection Tool The ultimate strategy for utilizing foreign trusts, foreign corporations, private annuities, limited partnerships and more.Reduced Fees for Foreign Planning -- If you are interested in Foreign Trusts, Foreign Corporations, or foreign planning and strategies in general, and you are in a position to take action before August 15, 2008, you will be pleased to note that I am prepared to offer substantial fee reductions for foreign planning prior to that date. Please see Announcement |
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ALL FOREIGN TRUSTS ARE NOT CREATED EQUALEffective January 1, 1997, the "Small Business Job Protection Act of 1996", attempts to discourage the use of foreign trusts, especially those grantor trusts, referred to as "Asset Protection Trusts". Generally speaking, the Act has little effect on the strategy described in my article, "The Ultimate Estate Planning Tool." I am writing a new article dealing with the Act in depth, but for the time being it seems prudent to try and clear up some of the confusion. To do that I will share with you, my reply to a particularly astute reader that sent me the following E-Mail. Question: Are you aware that in a 1996 Cook Islands court decision opened
the books of trust companies there to publish details of how some wealthy Reply: I believe your assumption is correct, although a jurisdiction can
always change its policy in the future. That is why it is so important to
select a jurisdiction with a long history of independence and respect for
privacy. Question: I also have a report that changes enacted in the Small Business Protection Act of 1996 enhance the ability of the IRS to tax the income of foreign trusts and increase disclosure requirements for such instruments. Reply: Foreign trusts, even under the new law are not taxed per se. The trusts that the new law is primarily aimed at are the Grantor Asset Protection Trusts. A grantor trust is one over which the grantor or creator, retains significant control over the trust. If it is a grantor asset protection trust, then the grantor is taxed on the income of the trust as though it were his own. Moreover, the new law sets forth very stringent reporting requirements for grantor trusts. The strategy I describe does not utilize a grantor trust, and therefore not only is the income of the trust not taxed to either the creator of the trust or the trust itself, but the reporting requirements do not apply. Queston: Effective Jan. 1, 1997, to qualify as a domestic trust, a court
within the USA must be able to exercise primary supervision over the
administration of the trust and one or more U.S. fiduciaries must have
authority to control all substantial decisions of the trust. This places
authority over the trust squarely within the Reply: Again, a "domestic" trust is one that is domiciled within
the The new law is very complex and gives new meaning to the word pollution. I am sure that the reply above raises as many questions as it answers, so if you have further questions, please let me know. Copyright ©1997 |
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