International Tax Planning

Offshore Holding Companies

An offshore holding company can be established in an appropriate jurisdiction such as Cyprus or Denmark. Current U.S. income tax law allows for a flat 15% withholding on the income of an offshore operating company. This flat 15% tax is predicated upon the operating company being wholly owned by the offshore holding company that is, in turn, owned by a U.S taxpayer, such as an individual (either U.S. citizen or resident alien) or an offshore asset protection trust with a U.S. settlor. There is no income tax whatsoever at the operating company level, and only a very small tax at the holding company level. The end result is far superior to the normal 30% withholding rate that applies in the absence of the holding company. This special U.S. income tax provision for offshore holding companies recently has been extended for a significant period of time.

Featured Article: Reducing U.S. Tax Liability Via Qualified Foreign Corporations

E-Commerce Structuring

A successful e-commerce business requires a well-conceived business plan and tax strategy. The Sequoia Group can streamline e-commerce operations by creating an offshore trust combined with offshore companies that conduct business using carefully planned strategies. Such strategies often involve locating an offshore jurisdiction with a solid economic environment, stable political system, advanced telecommunication infrastructure, readily available licensing and an income tax treaty with the U.S.

International Life Insurance Trusts (ILIT)

International Life Insurance Trusts are formed in order to purchase offshore insurance policies and subsequently receive the insurance proceeds outside of the taxable estate of the decedent. The complex rules relating to domestic ILIT’s are often quite confusing to investors with large estates. The Sequoia Group offers the sophisticated investor a viable alternative by utilizing offshore trusts and insurance benefits in a way that maximizes tax benefits and achieves significant asset protection.

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