About ASSET PROTECTION (FOUNDATIONS)

Click on the question in order to obtain it answer.

1. What is a Panama Foundation?  

2. What can a Foundation do?

3. What can a Foundation not do?

4. Does a Panama Foundation have a tax obligation in Panama?

5. Who owns a Panama Foundation?

ANSWERS

1. What is a Panama Foundation?
The Panama Private Interest Foundation is an asset protection tool par excellence. A foundation is a hybrid asset protection vehicle that encompasses some of the elements of a trust, a corporation and a will all wrapped up into one that is better than any one of them.
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2. What can a Foundation do?
It can own bank accounts, stock brokerage accounts, real estate anywhere in the world, art, gold, boats, airplanes, automobiles and it can own corporations. It is similar to a holding company but much more dynamic.
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3. What can a Foundation not do?
A Panama Foundation may not directly engage in commercial activities. However the foundation can own a corporation from Panama or anywhere else and this corporation that it owns can operate commercially.
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4. Does a Panama Foundation have a tax obligation in Panama?
If all the Panama Foundation income is derived outside of Panama there is no income tax due and no need to file a tax return in Panama. Panama has no capital gains tax on bank interest or stock market gains and no inheritance tax.
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5. Who owns a Panama Foundation?
Under Panama law a foundation cannot have an owner, thus ownership is impossible. This enables one to arrange for the Panama Foundation to own the shares of a Panama Bearer Share Corporation. A Panama Private Interest Foundation is a judicial or unnatural person like a corporation. A offshore trust is not a judicial person; it is merely a written agreement as to how assets are managed. It has its own assets and liabilities separate from those of the founder, protector or beneficiaries.

Foundation Beneficiaries – The foundation can have a secret letter of wishes that is basically beneficiary instructions. These instructions are not in any public registry and are not filed with the government, thus they are private or secret. Beneficiaries can be changed at anytime. The beneficiary is not an owner and their debts are not debts of the foundation.

Foundation Founder – Our law firm normally provides a founder for the foundation so you need not be the founder. The foundation founder is not an owner or controller of the foundation.

Foundation Nominee Council Members – These are nominee employees that are very similar to the nominee board of directors of a Panama Corporation. There is very little they can do. They will execute signed but undated resignation letters. They will also generate to you a general power of attorney so you can act carte blanche on behalf of the foundation.

Foundation Protector – This is an office generally held by the one requesting the foundation be formed. It is a position of control but not ownership. It can be documented with a written employment contract stating duties including signing on the bank account, keeping the books and records and seeing that the overall foundation goals are being met. We generally have these agreements customer created to suit and they are signed by the nominee foundation council members, then notarized and apostilled.

Foundation Asset Protection – Panama has special laws to protect foundation assets from pre-trial freezes except if the foundation does something directly incorrect like it breaks a written contract for no good cause. We prefer the foundation to just act as a holding entity to avoid this.

Foundation Beneficiaries Fighting – The beneficiary instructions set forth in a foundation will be enforced by the Panama court exactly. You will not hear of the children suing each other and fighting over the estate of the parents. There is no inheritance tax in Panama