Despite the crime documentaries and movies you have watched, it is not illegal to have an offshore banking account. Nor does opening an offshore banking account mean you are attempting to commit tax evasion or are involved in any illegal activities. Offshore asset protection is simply to protect you against potential creditors (partners, ex-spouses, clients, lawyers) who may attempt to sue you. If the person suing you wins their case, then you are forced by the court to turn over a certain amount of your assets to them. However, the assets that you are being forced into paying must be located in your own country. This is where an offshore account comes into play. By legally transferring your assets and savings into an offshore institution ( www.EsquireGroup.Com/Offshore-asset-prot
1. Identify your safe assets
A safe asset is an asset that does not carry a high risk of loss, nor does it expose you to potential legal liability. The most common types of safe assets, often referred to as safe havens, are cash, bonds, or shares in mutual funds. Your safe assets do not require offshore asset protection.
2. Identify your dangerous assets
Once you know what your safe assets are, you must identify what isn’t a safe asset. Dangerous assets are pieces of property or investments that pose a risk of liability to you and require offshore asset protection. Dangerous assets are often physical assets, such as a building, a vehicle, or equipment that can cause harm to another person.
3. Consider whether you have sufficient assets
Offshore asset protection comes with a high price, so you need to know whether or not you can afford the long-term fees associated with establishing your own account. Foreign trusts generally cost $20,000 to create, and accounting and administration fees can cost $7,000 per year.
4. Identify your potential creditors
Not all creditors are the same, so you need to understand what your offshore asset protection protects you from—and which creditors are more difficult to avoid. If you own a car rental company and someone who was injured in one of your cars due to a mechanical fault decides to sue you, then that person is considered a private plaintiff. Your offshore assets are protected against private plaintiffs, but less protection is granted against the IRS or a state taxing authority.
5. Setting your account up
Now that it’s time to set your offshore asset protection account up, consider these legal strategies for shielding your assets:
• Use limited liability companies. LLC statutes include provisions that prevent creditors from taking your company or the assets inside.
• An asset protection trust is considered the most powerful tool to protect your money from a lawsuit, especially because it is one of the few asset protection strategies ( www.EsquireGroup.Com/about ) that works after a lawsuit has been filed. It limits the power of the courts and opposing attorney because local courts do not have the jurisdiction over foreign trustees. While there are domestic options, the strongest legal statutes are in the Cook Islands and Nevis.
• Do not hold non-exempt assets in your own name because the first thing an opposing attorney will do is search for your assets. Consider owning a car in a title holding trust or owning a property in a land trust.