Foreign National Planning

Working in the foreign nationals marketplace for over a decade.

Foreign nationals face a very complex set of obstacles in estate and wealth planning when dealing with the United States. Additionally, the rules change depending upon resident or non-resident status, which is not as clear-cut a distinction as many expect and, in many cases, depends upon beneficiaries as much as the client himself. In many cases, a client has done extensive planning to keep his wealth out of the United States and thus free of the United States Estate Tax, only to find that all of his assets are subject to a punitive “Throwback Tax” including compounded interest and penalties that over time can equal or exceed the entire estate.

Texas Financial Advisory has extensive experience in structuring Foreign National Estate Plans to help minimize or eliminate the effects of punitive tax treatment. Most firms in the U.S. may be unfamiliar with how to procure life insurance for foreign nationals and the international tax laws that one must navigate. If done incorrectly, the end results can be disastrous from a tax perspective. Texas Financial Advisory has been working in the international marketplace for over a decade and has extensive experience in procuring and structuring foreign national insurance.

Each country has specific laws that change the face of the insurance industry with respect to that nation. By intimately understanding these laws, Texas Financial Advisory is able to uniquely assist foreign national clients in advantageously structuring policies whether for death benefit and estate purposes or those seeking to take advantage of the policy benefits during their lifetime. When structured correctly, foreign nationals may set up these policies as vehicles in which the underlying cash values are protected from principal loss and will grow without income tax or capital gains tax (under U.S. tax law). They can also access the cash values via policy loans without income tax and enjoy the funds during their lifetime. Ultimately, the policy will pay a death benefit, which will help shift wealth (income tax-free) to future generations in an asset-protected environment.

Texas Financial Advisory has been working in the foreign nationals marketplace for over a decade. To add to our knowledge, we have a network of accounting and law firms in various countries from Mexico to Switzerland that rely on us for our expertise in this niche and continue to help us stay current on all changing laws in the international community.

Guarantees and protections provided by life insurance products are backed by the financial strength and claims-paying ability of the issuing insurer.

Policy loans and withdrawals will reduce available cash values and death benefits and may cause the policy to lapse, or affect guarantees against lapse. Additional premium payments may be required to keep the policy in force. In the event of a lapse, outstanding policy loans in excess of unrecovered cost basis will be subject to ordinary income tax. Tax laws are subject to change and you should consult a tax professional with regard to your personal situation.

Please call us at 210.530.1292 to discuss how a U.S.-based life insurance structure may greatly enhance your financial planning.