For the most part, offshore life insurance is similar to the life insurance that you have in the US. You pay into the policy, and upon your death, your beneficiaries will receive a payout.
However, unlike domestic life insurance, offshore life insurance can also serve as a useful method of diversifying and protecting your assets.
Provided you follow certain rules, you can set up your offshore life insurance to be a tax shelter. This makes it a more favorable alternative to other offshore investments, such as mutual funds, where events outside of your control can increase your tax liability.
Provided that you set it up the right way, you can use offshore
life insurance as a legal and legitimate tax shelter to protect your assets.
Although you’re legally allowed to use an offshore life insurance policy as a tax shelter, the IRS doesn’t exactly make it easy to do.
However, as with most things, the IRS doesn’t exactly make it easy to use offshore life insurance as a
tax shelter. You need to follow a careful set of rules to ensure that your offshore life insurance policy
is a truly legal tax shelter, so it’s important that you take the time to do it correctly – and always
seek professional guidance along the way.
This section will, therefore, give you an overview of how to set up your offshore life insurance tax shelter and discuss common issues that people tend to encounter during this process.
Copyright © 2020 Byster Financial Bank. All rights reserved.