The top 7 overlooked Offshore Foundation Benefits
By: Doug Sitenal
Many people do not understand the difference between an "offshore foundation", "offshore corporation" and an "offshore trust".
An offshore foundation is used to manage and control assets. This is accomplished through a secret letter of wishes. This letter is, as it's name implies, a private document that is not available to the public. Under no circumstances, is this letter ever required to be made public and is protected by Panama law.
A foundation can be used much like a trust to pass on assets bypassing estate taxes at the time of death. Many countries have made death a taxable event. This makes absolutely no sense of course and every person should consider an offshore foundation (or offshore trust) to protect their assets.
Who can own a foundation under Panama law? Nobody. That's right. A Panama foundation cannot be legally owned by anyone. It is it's own entity. This one aspect makes it a very powerful asset protection vehicle. Also a foundation carries respect that a simple, anonymous bearer share corporation (also available in Panama) does not get. This is important sometimes, when entering into contracts with other companies or opening bank accounts in some (but certainly not all) jurisdictions.
The reason an offshore foundation should be part of any bullet proof asset protection structure, is because an offshore foundation is not owned by anyone. This makes a judgment against it impossible. How would an onshore court order anyone to return the funds from a foundation back onshore. He simply can't because it is illegal for a court to order you to return the funds. The funds belong to a foundation and you CANNOT own it because a foundation is not owned by anyone.
Many people ask why they need a corporation and a foundation. Legally a foundation cannot engage in business activities, like marketing and selling a product. A foundation can, however, own an offshore company. The offshore company can then engage in business activities. This is the most common and safe asset protection techniques used in offshore banking and asset protection today.
Unlike onshore trusts, which are commonly used in estate planning, an offshore foundation is strictly enforced by Panama courts. In the event of death, family members will not be entering into litigation to try and break the foundation. It is common for an onshore trust to be broken for any number of different reasons. If you want your wishes followed to the "letter" then a Panama foundation is your best option.
One benefit that cannot be overlooked is the tax advantage of an offshore foundation. It is not owned by anyone and it does NOT pay tax on any money it manages (as long as it is not derived in Panama).
Article Source: http://www.ezarticles.info
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