Corporate Owned (or Foundation/Trust) Accounts vs. Personal. Lance Wallach, expert witness.

If your primary reason for going offshore is for more secure, more private, safer and more varied banking and investment options then you may want to think again.

Invest & Bank Offshore

If your primary reason for going offshore is for more secure, more private, safer and more varied banking and investment options the first thing you need to consider is the forming of one or more offshore structures. Without thinking many people assume they can simply open a personal account in their name and because that account exists in a country and bank that still observes strict banking secrecy, their identity will be protected by the bank and that nation’s privacy law.

The problem here is that every time you want to make a payment into the account or out of it, your name will be in effect broadcast to the world as the owner of that account. This is because the so called numbered accounts of the past are no longer available anywhere. Any incoming or outgoing payment from the account will always have your name associated with it on the bank-to-bank routing instructions. Therefore, it is imperative that the account be opened in the name of a company, foundation or possibly a trust rather than your personal name. Yes, as signatory on the account you will be still known to your bank, but your account will be anonymous to the world, so long as you bank in a country that still does not routinely share information with foreign governments and private investigators.

That way any payment into and out of the account is not automatically linked to yourself personally because the name of the company, foundation or trust will now only be on the inter-bank payment instructions and nothing else about the account will be visible. This concept of the “corporate shield” is one of the most important aspects of forming a foreign company even if you do not plan to conduct any business other than banking and investments. The company (or foundation) becomes a separate legal entity with its own life and rights under law. It is the whole basis behind the asset protection features of a foreign company formed in a country like Panama with favorable corporate laws that favor the ordinary person that merely wishes to shield their assets from predators.

The problem with all this is that you run into FBAR and OVDI IRS problems.

As an expert witness Lance Wallach's side has never lost a case. People need to be careful of 419 Welfare Benefit Plans, 412i plans, Section 79 plans and Captive Insurance Plans. Most of these plans are sold by insurance agents. If you are in an abusive, listed or similar transaction plan you need to file under IRS 6707a. The participant files form 8886, and the salesmen or accountant who signs the tax returns files form 8918 if they got paid over $10,000. They are called Material Advisors and face a minimum $100,000 fine. Some plans are offshore which could involve FBAR or OVDI filings. If you have money overseas you probably need to file for IRS tax amnesty. If you want to reduce the tax we suggest that you first file and then opt out. For more information Google Lance Wallach.

The information provided herein is not intended as legal, accounting, financial or any type of advice for any specific individual or other entity. You should contact an appropriate professional for any such advice.