Pre-Immigration
Tax Planning: 10
Most Common
Mistakes To
Avoid When
Using Offshore
Trusts
Steps to take before becoming a United
States resident to avoid getting hit with
unexpected and unfavorable U.S. income
and estate tax consequences.
By Lazaro J. Mur
I
f you are thinking about moving to the United States, you
should be thinking about pre-immigration tax planning.
Otherwise, you may face significant U.S. income and estate
tax consequences as a result.
Proper and timely pre-immigration tax planning may involve
establishing an offshore trust. Here are the top 10 most
common mistakes to avoid when using offshore trusts from
a U.S. tax planning point of view.
NOT KNOWING ALL THE FACTS
Many readers thinking about moving to the United States do
not understand the nature of the U.S. tax regime because they
may be coming from a jurisdiction that has a totally different
tax system.
Once you move to the United States with your green card,
you become a U.S. resident for income tax purposes. You will
be taxed on your worldwide income and, if you are deemed
domiciled in the United States as a result of moving to the
United States, then your entire worldwide holdings will be
subject to estate taxes. Needless to say, this is a harsh reality
for some to understand, much less accept. This is why pre-
immigration tax planning is of critical importance if you are
thinking of moving to the United States.
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