International Business, Tax, Estate Planning and Asset Protection Planning
Stephen A. Malley offers specialized and experienced counsel in U.S. and International tax and business planning, transnational business structures, international licensing, pre-immigration tax planning and estate planning for U.S. individuals and families with foreign interests and for foreign families with U.S. beneficiaries or U.S. based assets.
UNITED STATES AND INTERNATIONAL TAX AND BUSINESS TRANSACTIONS
Individuals or companies with international assets and/or business interests must consider not only the applicable laws of each Country, but also the tax implications of both the U.S. and relevant foreign jurisdictions. Tax rates on dividends, interest, and royalties are often determined by tax treaties. While “treaty shopping” is discouraged by the terms of many tax treaties, careful planning might take advantage of the most favorable tax treaties. The application of tax credits is often complex . Mr. Malley represents individuals and business entities engaged in domestic and international commerce. Of primary importance is planning to achieve the desired business purposes, taking into consideration foreign law and business practices.
Mr. Malley assists non-U.S. clients in planning for U.S. legal, regulatory, and tax issues, and US clients in their business transactions and arrangements overseas.
Failure to comply with foreign and domestic legal and tax obligations can result in serious problems.
TRANSNATIONAL ESTATE AND TAX PLANNING
Estate planning often involves consideration of Estate, gift and income taxes. US persons with overseas assets, and foreigners with US assets, require specialized professional advice to avoid negative tax and probate issues. U.S. taxpayers with foreign spouses are particularly vulnerable to negative tax consequences absent appropriate planning.
Foreign persons with U.S. assets can be subject to U.S. gift tax, and, on death, to U.S. estate tax, and this comes often as an unpleasant surprise. The U.S. tax code provides guidance on what types of assets are “sited” in the U.S. for gift and estate tax purposes. Often, it is advantageous for a foreigner to hold U.S.based assets in an offshore entity, for example in a Trust or corporation, as best determined by the foreigner’s own or selected jurisdiction.
Foreign families with U.S. beneficiaries can achieve tax minimization and/or control with proper planning.International Business, Tax And Asset Preservation Planning
PRE-IMMIGRATION TAX PLANNING
Persons immigrating to the U.S., either permanently or for temporary employment, will be subject to tax on world-wide income. Depending on circumstances, planning before arriving in the U.S. can minimize exposure to U.S. income and estate tax; there is a minimal estate tax exemption for estates which pass to non-Citizens.
ASSET PRESERVATION PLANNING
Mr. Malley provides transnational estate, tax and asset protection planning for United States citizens and for foreign nationals. Asset protection should be considered in any estate plan. There are many planning opportunities to achieve this protection, depending on factors such as the extent and location of assets, and the individual’s family arrangements, beneficiaries, and other planning goals, which may include privacy and anonymity. Asset protection should be part of any estate planning whenever significant assets are involved.
In the U.S., fraudulent conveyance laws (not discussed here in detail) must be considered whenever there exists a known creditor, any transfer of ownership of assets, including to a domestic or offshore irrevocable trust, might be deemed by a court to be a fraudulent conveyance which can be “set aside” for the benefit of a judgment creditor. However, the Transfer of assets in such circumstance may not automatically constitute a “fraudulent conveyance” but careful analysis is required. In such circumstances, there are arrangements which can be made to lawfully protect assets, including the use of limited liability companies in beneficial jurisdictions.
Asset protection planning undertaken before there is a creditor issue offers many more options. For example, the use of “family” limited partnerships or limited liability companies can be appropriate; and irrevocable trusts domiciled in certain States can allow the settlor of the trust to be a discretionary beneficiary and still protect the trust assets from creditors (not the case in California.).
On-shore and offshore holding companies are of use in certain circumstances.
The ultimate forms used to protect assets will be determined by relevant facts, estate and tax planning objectives, and the particular wishes of the individual.
LICENSING AND SALE OF TRADEMARKS, PATENTS, COPYRIGHTS AND COMPUTER SOFTWARE
U.S. tax law imposes strict guidelines of the transfer of intellectual property but it is often possible to minimize or defer U.S. tax exposure in connection with overseas licensing. Many but not all tax treaties limit the withholding tax on royalty payments, both into and out of the U.S. Joint development of IP with a foreign partner or subsidiary is also subject to IRS rules and regulations, and these do change from time to time. Foreign licensors into the U.S. must consider the tax implications in all relevant jurisdictions to maximize returns. Business issues, such as control and payment, need careful analysis and consideration of applicable business practices, currency controls and exchange rates.
