California Asset Protection Attorney, Sebastian Gibson
Asset Protection - Offshore Asset Protection and Offshore Corporations
If you’ve been searching for California asset protection lawyers or offshore asset protection attorneys in California and haven’t found the asset protection attorney in which you can be confident when retaining a lawyer for your asset protection, voluntary disclosure, offshore trust protection and family limited partnership matters in California, Sebastian Gibson is the asset protection attorney you’ve been looking for.
California Asset Protection Lawyer
With over thirty years of experience handling international matters, with law degrees in both California and in Great Britain, and years of international experience in London as well as decades of experience in California, California asset protection lawyer Sebastian Gibson brings a wealth of experience to the table and was chosen one of the 2011 Top Lawyers by Palm Springs Life Magazine.
In providing offshore asset protection to individuals, debtors seeking a further layer of confidentiality and asset protection from creditors often create offshore corporations. The corporation through its nominee officers and directors is used to hold title to bank accounts, brokerage accounts and other assets. Bearer shares are sometimes controlled by an offshore trust and the offshore corporation is formed in a jurisdiction that is different from that of the offshore trust.
These asset protection strategies call for assets to be held by the foreign limited liability with all of the membership interest in the LLC given to the foreign trust. Most often the two are in different jurisdictions. The manager of the LLC thus has all of the control over the bank accounts or brokerage accounts. In this strategy, it is thus possible for a U.S. person to control the assets yet have ownership of none of them. Should there be a risk developed against this manager, or should his independence be jeopardized, the manager can be removed and a foreign trustee step in to manage the LLC’s assets. Once the risk has been eliminated, the original manager can be placed back in control.
In most offshore jurisdictions with protective LLC laws, an LLC creditor’s rights are limited to a charging order, with no right to foreclose. Foreign LLC’s are governed by the law of the jurisdiction where the LLC is organized, allowing for favorable asset protection laws of the foreign jurisdiction to be applicable and additional costs to be incurred by any creditors seeking assets of the debtor.
With a combination of an LLC and an offshore trust, a creditor must first successfully attack the foreign trust, and following that, obtain a charging order against the LLC and collect on it. The debtor is thus provided with an extra lawyer of protection.
For purposes of example in providing offshore asset protection by the use of forming an offshore corporation, this article will use Nevis as the jurisdiction. Other jurisdictions are used just as frequently by asset protection attorneys, but in recent years, Nevis has become a popular jurisdiction for the formation of LLCs and the following information will show why.
Nevis is frequently used for the establishment of foreign LLC’s because of its debtor-friendly laws. Although Nevis does not have the history of many offshore jurisdictions used for asset protection, the Nevis LLC combines many of the protective advantages found in offshore trusts in the most protective jurisdictions. Assets are owned by the LLC which the member owns but does not manage. Management can also be performed by a foreign director who controls the LLC.
A creditor cannot seize an individual’s membership interest or the member’s interest. A creditor’s charging order can only be obtained from the Nevis courts.
In the event of litigation against the member-owner of the LLC, the managing director will commonly withhold distributions which a creditor could seize with his or her charging order, or the member-owner can place his or her LLC interest in another Nevis LLC to receive distributions. A charging order will not apply to salaries of the member for services such as being an investment advisor.
A Nevis LLC should have multiple members which optimally should require a unanimous vote to change the foreign managing director. A Nevis LLC can also have a protector just like an offshore trust. It can also have a flee clause, also known as a Cuba clause so a manager can transfer LLC assets to another offshore financial entity in another foreign jurisdiction. A Nevis LLC, as already discussed, can also be owned by an offshore trust.
What some courts might consider a fraudulent transfer to a foreign trust, may not be so considered with the creation of a Nevis LLC. Nevis LLC ordinances allow a member to transfer his or her assets to an LLC without it being a fraudulent transfer, even if the LLC member has an existing creditor, so long as the debtor-manager’s interest is proportionate to the capital the member contributes.
Nevis imposes no taxes on their LLC’s. An LLC can be set up such that profits flow to its members in whatever proportion is specified in the operating agreement. But while a Nevis LLC is advantageous in certain circumstances, a foreign trust is still more useful for estate planning.
Judgments obtained outside Nevis are not recognized by the courts in Nevis. A creditor thus cannot ask a Nevisian court to enforce a U.S. judgment.
Although Nevis LLC owners and managers are not registered, U.S. taxpayers should not count on their privacy in this 9/11 era of crumbling bank secrecy and tax information exchange treaties and must still follow all U.S. taxpayer reporting requirements and reporting of income.
While other jurisdictions provide for foreign LLC’s, Nevis does not impose corporate tax, income tax, withholding tax, or even stamp tax or exchange controls on a taxpayer’s assets and income originating outside of Nevis and there is no tax on accumulated but undistributed earnings. A Nevis LLC can have one or many members while a manager can have 100% control of the LLC even without any ownership.
Another jurisdiction with LLC’s used by asset protection strategists is the Cook Islands. Jurisdictions are constantly developing new protective entities. An individual should only have an asset protection attorney who constantly monitors the laws affecting foreign jurisdictions develop a client’s asset protection plan and incorporate it into a comprehensive estate and tax plan.
In compliance with IRS requirements, we must advise you that any U.S. federal tax advice or offshore asset protection advice contained in this informational article is not intended to be used nor is it published in order for it to be used and you may not use it for the purpose of avoiding penalties or fines under the Internal Revenue Code. It is not intended to be used nor is it being published in order to promote, market or recommend any specific transaction, the formation of an offshore corporation, tax-related matter or estate planning tax scheme to any party.
California Asset Protection Attorney, Sebastian Gibson
Sought out to be a writer for California’s two largest and most prestigious legal newspapers, California asset protection attorney Sebastian Gibson’s articles have been published in the Los Angeles Daily Journal and the San Francisco Daily Journal. Today thousands and thousands of people visit this website and his blogs monthly for useful advice and thousands more follow him on Twitter for his humor.
One of the best asset protection attorneys for people in California to follow for his humor and wit, one of the funniest California asset protection lawyers as well as one of the top humorous California asset protection attorneys people follow on Twitter, California asset protection attorney Sebastian Gibson has been called "brilliant," "hilariously funny" and a "legend."
It matters more than you think who you call for your asset protection and other legal matters. When it matters most, call California asset protection lawyer Sebastian Gibson. When it’s time to hire a California asset protection attorney, hire a legend.
