Nevis LLC and general LLC questions

[Silo]

Hello all,

I have some questions that I was hoping the members here could help me with.

I live offshore in the Caribbean and have no tax obligations where I live or in my country of citizenship.

I am interested in forming a Nevis LLC to hold liquid assets and would like to know the following as I have more experience with IBCs:

1. One thing raised by my bank which they could not help with was how a single member LLC would be treated with respect to US estate tax on situs assets which include. As a non-US person on death if I am the sole member of a Nevis LLC and want to pass on the membership rights to my wife would this event trigger any US estate tax liabilities?

2. As in IBCs where the shares in a company can be held jointly say by husband and wife with the right of survivourship can the membership in a foreign LLC be easily passed to the surviving party? If not with the exception of a trust are there any estate planning options that can be used in conjunction with how an LLC is setup?

Thanks

 

[myhand]

1. One thing raised by my bank which they could not help with was how a single member LLC would be treated with respect to US estate tax on situs assets which include. As a non-US person on death if I am the sole member of a Nevis LLC and want to pass on the membership rights to my wife would this event trigger any US estate tax liabilities?

you want to consult a US tax consultant to get clarification and possible solution.

As in IBCs where the shares in a company can be held jointly say by husband and wife with the right of survivourship can the membership in a foreign LLC be easily passed to the surviving party?

Usually not a bid deal, inform the agent and he will do the change.

 

[Martin Everson]

I live offshore in the Caribbean and have no tax obligations where I live or in my country of citizenship.

Howdy neighbor

1. One thing raised by my bank which they could not help with was how a single member LLC would be treated with respect to US estate tax on situs assets which include. As a non-US person on death if I am the sole member of a Nevis LLC and want to pass on the membership rights to my wife would this event trigger any US estate tax liabilities?

I am glad you are actually thinking about U.S Estate Tax on your investments as a non-resident. 99.9% of people never consider this as the U.S is not actively enforcing it which could change at any point now. If the assets are under $60k do not worry. With a Nevis setup you are looking at a transfer of shares to your wife. The question you have to ask is if in future tax laws will consider it an anti avoidance setup and whether you will be happy with your partner filing papers in U.S.

Some Nonresidents with U.S. Assets Must File Estate Tax Returns | Internal Revenue Service

As Khan says you need to consult a U.S tax consultant especially if amounts are over $60k. I personally just avoid the U.S for anything financial.

 

[Silo]

I am glad you are actually thinking about U.S Estate Tax on your investments as a non-resident. 99.9% of people never consider this as the U.S is not actively enforcing it which could change at any point now. If the assets are under $60k do not worry. With a Nevis setup you are looking at a transfer of shares to your wife. The question you have to ask is if in future tax laws will consider it an anti avoidance setup and whether you will be happy with your partner filing papers in U.S.

I really wasn't familiar with this requirement until it was raised by my bank as the only real tax consequence based on my own circumstances. I believe that many people are unfamiliar with this potential liability and likely because as you say it's not enforced.

If you guys know of a US tax advisor that would be able to assist that is familiar with Nevis LLC's and could PM me their details it would be greatly appreciated.

 

[troubled soul]

OMG I never know that, It is 40%
It is like Daylight Robbery.

 

[Golden Fleece]

OMG I never know that, It is 40%
It is like Daylight Robbery.

In the U.S., the first $11.7 million is exempt from the estate tax and that estate tax is also easy to avoid with a trust.

If you have an estate large enough to potentially be subject to estate tax, additional planning may be in order. That’s not an issue for most Americans, because the first $11.7 million of assets conveyed to the next generation are exempt from tax. But if President Biden succeeds in reducing that threshold to $3.5 million, as he’s promised to do, a lot more estates might be subject to this tax.

https://www.nestmann.com/what-larry-king-and-prince-had-in-common

 

[Martin Everson]

In the U.S., the first $11.7 million is exempt from the estate tax and that estate tax is also easy to avoid with a trust.

The threshold for US citizens and US domiciles is $11.7m which gets inflation adjusted each year. The threshold for non-US residents and non-citizens is $60k. Don't get the two confused please.

https://www.irs.gov/businesses/smal...onresidents-not-citizens-of-the-united-states
P.S Seek professional tax advice. Nothing said here by me should be taken as tax advice .