Tax Planning, Foreign Trusts, Internal Revenue Code (IRC)

What is a Foreign Trust?

Freeman Law on 3/27/2024

Explaining a Foreign Trust in Easy-to-Understand Language - In this global economy, it’s becoming increasingly common for U.S. citizens and residents to have financial ties overseas. These financial ties often come in the...more

The High IRS Tax Rates on a Foreign Trust

Allen Barron, Inc. on 10/31/2023

Are you concerned about the high IRS tax rates on a foreign trust? It is important to understand the tax and reporting consequences on this specific type of investment. It may very well be time to evaluate the net value of...more

Fighting a Three Headed Dog and Tax Classifications of Foreign Trusts

Bilzin Sumberg on 3/6/2023

The Continuing Saga of U.S. Tax Classification of Foreign Trusts and Related Penalty Issues - In Greek mythology, Cerberus, a three-headed dog, was known as the guardian of the underworld. In more recent literature, a...more

The IRS’s Renewed Focus on Abusive Trust Arrangements

Freeman Law on 1/14/2022

Taxpayers have long utilized trust arrangements for the transfer of wealth to beneficiaries or for the protection of assets from creditors. Generally, there is nothing nefarious about these types of arrangements. Rather,...more

What Makes a Trust a "Foreign" Trust?

Bilzin Sumberg on 2/25/2021

In a previous post, we discussed the tax implications for U.S. beneficiaries who receive a distribution from a foreign trust. That discussion assumed that the trust in question was, in fact, a foreign trust for U.S. federal...more

IRS Reporting Requirements for Foreign Retirement Accounts

Bowditch & Dewey on 8/13/2020

Section 6048 of the Internal Revenue Code requires reporting of a U.S. citizen or resident alien’s (a) transfers to a foreign trust, (b) annual financial information related to the U.S. person’s interest in a foreign trust,...more