In today’s world, and especially here in Miami, the concept of “multi-jurisdictional families” (i.e., families with members living in different countries) has become commonplace. Such family structures present unique challenges when trying to plan for both current income tax implications and succession tax consequences. Each country has its own tax regime, and each country is different. Avoiding the pitfalls of the U.S. tax regime will help you avoid unpleasant surprises from
the IRS. In representing families from around the globe, at Dorot & Bensimon PL we are familiar and experienced with the challenges, and specialize in finding creative solutions to address the ever-changing landscape of your life; so your decisions do not have to be based on tax implications but on your personal goals and desires.
Pre-Immigration Tax Planning
Immigrating to the United States entails significant considerations. An immigration attorney is probably already assisting you in obtaining a Visa, residence status or permanent citizenship. However, very strict and sometimes unduly burdensome tax rules apply to foreigners immigrating to the United States, which your immigration attorney may not be familiar with. The sooner you are aware of these potential pitfalls, the more opportunity you will have to avoid them. At Dorot & Bensimon PL we assist our foreign clients in preparing for the move in the most tax efficient manner by utilizing foreign trusts and pre-immigration gifting techniques. If you are a high-net worth individual, or if you plan on migrating your foreign business to the U.S. or keeping it operating in the foreign country, it is imperative that you are properly advised before the move in order to assure that you are maximizing the tax planning opportunities and minimizing the lack-of-planning pitfalls.
For those citizens and permanent residents looking to expatriate from the United States, new laws enacted in 2008 have changed the expatriation landscape dramatically. The 10-year rule you may have known in prior years has been replaced with a
new expatriation regime. The new rules are somewhat more complicated and require the expatriate to pay an “exit” tax, however in the long run, the new scheme is more efficiently enforced and, in the right circumstances, provides for significant tax benefits to the expatriate.
While expatriation may not the solution for every client, at Dorot & Bensimon PL our attorneys can help you determine whether expatriation is the right solution for you and, if so, we can assist you throughout the process to assure that you are maximizing the potential benefits and avoiding the common pitfalls
Foreign Investment in U.S. Real Property
Some of the most dangerously unknown tax traps exist in the realm of foreign investment in U.S. real property. With the high demand for U.S. real estate by foreign buyers, the opportunity to capitalize on a great rebounding market has neve
r been greater. While such investments are expected to yield great return in both in the short and long-term horizon, properly structuring the investment is crucial.
Limited Liability. The investment must be held in a limited liability form where the investor is protected from outside creditors.
Management. The investment must account for the appropriate management structure to assure efficiencies and competency in the day-to-day operation of the investment.
Tax Considerations. An appropriate entity structure must be set up in order to prevent estate tax inclusion of the investment upon the foreign investor
’s death. Many foreign investors ignore this concern to their severe detriment. Furthermore, withholding of income tax both on the ongoing income generated by the investment as well as gains from the ultimate sale of the investment must be properly addressed.
At Dorot & Bensimon PL we will assist you in ensuring your protection to the highest degree available in order to maximize your investment and avoid unnecessary tax implications. Once the appropriate structure is in place, you will be able to increase your investment at minimal additional set-up cost. Whether you intend on investing in a small apartment on South Beach, an entire building on Brickell, or a shopping center in Doral, our attorneys will vigorously and competently represent you throughout the entire process.
Foreign Investment in U.S. Markets
With global uncertainty in various nations around the world, foreign individuals have often turned to the U.S. markets as a safe place to hold their investments. Non-Resident Alien (“NRA”) investment in stocks, bonds, mutual funds and other more complex investment vehicles is subject to a diverse set of rules that provide unique planning opportunities not available to the typical U.S. investor. Proper plan
ning can lead to significantly tax advantaged or, in some cases, tax-free returns for the foreign investor; however, any proper plan must consider the tax consequence to the NRA investor in both the U.S. and their native jurisdiction of residence.
At Dorot & Bensimon PL, we specialize in assisting clients from across the globe in structuring their U.S. investment so that they can benefit from the advantages and avoid the pitfalls. In coordination with your investment advisor, we can devise a U.S. investment structure that maximizes return, minimizes global tax consequence and limits required tax reporting.
International Tax Compliance
Within the global trend toward fiscal transparency, the international, Common Reporting Standard (“CRS”) and the U.S., Foreign Account Tax Compliance Act (“FATCA”) have significantly increased the reporting requirements placed on individuals who invest outside of their tax home. At Dorot and Bensimon PL, our experience allows us to assist you in navigating the intricacies of financial disclosure. Whether you are a foreign investor whose financial institution has requested that you complete a W-8BEN or a U.S. person with foreign investment that requires reporting on FinCEN Form 114 “Report of Foreign Bank and Financial Accounts” (“FBAR”) and Form 8938 “Statement of Specified Foreign Financial Assets,” we will work with you to assure complete, accurate, and timely compliance with all international reporting obligations.