Corporations, LLCs, Trusts, And Foundations—A Layman’s Guide
A reader wrote last week asking me to name the best jurisdiction for setting up an offshore entity. I can’t answer that question, at least not simply, especially for a U.S. person. We U.S. people have complicated tax rules to consider and remember no matter where we and our money go.
Before trying to identify where might be the best place for you to open an offshore entity, first consider what type of entity you need—a trust, a foundation, an LLC, or a corporation? The answer to that question will point you in the direction of the jurisdictions that might suit best.
I can’t answer the question which jurisdiction is best, but put the same question to an offshore attorney, and he’ll generally have quick and specific recommendations, typically one or two countries. Ask another attorney or offshore professional, and he’ll likely do the same, naming, maybe, two different jurisdictions from the first guy.
Who’s right? Neither. Most offshore advisors find a couple of favorite jurisdictions and stick with them. It allows them to become intimately familiar with the specifics of the entity rules for those countries. In other words, most offshore attorneys specialize when it comes to jurisdictions.
The truth is, though, that most countries are essentially the same with regard to functionality and asset protection. Pricing varies, and some countries carry more cache than others making it easier for you to impress your friends at the country club with references to your Cayman Islands corporation, for example. But I’d say don’t worry about what your friends think. Choose a destination because
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