non-tax specific issues for multinational families
TRANSCRIPT
HANDS-ON ADVICEPlanning Strategies for multinational citizens
Agenda Situs of personal,
real property tangible and intangible assets
Probate, court and practical issues with foreign fiduciaries
Requisite planning documents
Marshaling international assets
Immigrant investor visas- a way to “purchase” a green card
U.S. trusts as asset protection vehicles
Property and AssetsSitus determination for
Personal Property
Includes real estate, timber, mineral rights, and sufficiently long leasehold interests.
Excludes works of art on exhibit, any personal property accompany the non-resident.Does not hold for items in a safe deposit box
Tangible/Intangible
Stock issued by a U.S. corporation is property within the U.S.
Securities held in U.S. brokerage account maintain U.S. situs.Physical location of certificates is irrelevant
Certain assets will not be characterized as having US situs.For example Life Insurance proceeds
Conversion to IntangibleOwnership by an LLC of LP may be deemed, through membership interest, to be non-U.S. situs property
Situs is not dependent on the underlying assets in the LLC or LP
Conversely, situs for a beneficial interest in a trust is determined by the situs of the underlying assets.
A general power of appointment over trust assets sitused in the US may be considered a beneficial interest sitused in the U.S.
Foreign FiduciariesProbate, Court and Practical issues
Guardianship Name local
temporary guardians Children without a
passport require court authorized third party to apply
Airline regulations for minor children
Visa application hurdles and delays
Some states will not allow sole foreign guardians
Foreign testamentary guardians signing at an embassy
TRAP FOR THE UNWARYIf a minor child moves abroad
Children in the U.S. with a green card are only permitted to leave the country for a period of one year before needing to reapply for re-entry to the U.S.
Estate Planning Documents
For non-resident/non-citizen
Foreign and Domestic Wills Wills to direct flow of assets in the
jurisdiction where property is located Civil Law Jurisdiction v. Common Law Protection of children’s interests and
forced heirship Gifting “claw back” of as many as 10
years
Necessary Documents
Create a Will that specifically does not reverse a will executed in a foreign jurisdiction to govern ONLY U.S. property
Health care Proxy, Durable Power of Attorney, HIPAA Release, Living Will
Marshaling International Assets
Specifically non-tax
Probate and Flow of Assets If a foreign (or U.S.) asset is not owned
in trust, there may be requirements for ancillary probate
A revocable living trust may be able to direct foreign beneficiary designation upon account holder’s passing
IRS Form 3520
If assets to a U.S. beneficiary were received through foreign gifts and inheritances or distributions from foreign trusts are in aggregate over $100,000, even if no tax is due, must file Form 3520
Immigrant Investor Visa
Ways to “purchase” a green card
To qualify a foreign national must invest, without borrowing, a minimum of $1,000,000 in a qualifying commercial
enterprise$500,000 in an economically depressed
area, marked by high unemployment
Immigration Reform
7.1% of all employment based visas Must create 10 full time jobs for U.S.
citizens within 2 years Senate immigration reform bill would
increase number of investor visas from 10,000 to 14,000
U.S. TrustsAsset protection in
Qualifications
Must be a U.S. grantor trust Settlor may not maintain a power of
appointment Only settlor and spouse can be
beneficiaries during settlor’s lifetimeSame-sex couples rulings still forthcoming
and quickly changing
QUESTIONS