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Delaware Trust Conference

Delaware Trust Conference. Stephanie E. Heilborn, Esq. Wednesday, December 2, 2009. When You Think TRUST , Think Fulbright. TM. U.S. Perspective. Common use of trusts in business and estate-planning contexts Robust body of state law governing trusts

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Delaware Trust Conference

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  1. Delaware Trust Conference Stephanie E. Heilborn, Esq. • Wednesday, December 2, 2009 When You Think TRUST,Think Fulbright.TM

  2. U.S. Perspective • Common use of trusts in business and estate-planning contexts • Robust body of state law governing trusts • Detailed rules on taxation of trusts; difficult to use trusts to “avoid” taxes 75894703.1PPT

  3. Advantages of Using Trusts to Structure Wealth • Separation of legal and beneficial ownership • Maintain control by family members and/or trusted advisors • Reduce transfer taxes as wealth is passed down to successive generations • Confidentiality • Perpetuity • Creditor protection

  4. Use of Delaware Trusts by Non-U.S. Individuals • Non-U.S. individuals have choices as to where to site trusts (e.g., Caribbean; Channel Islands; continental Europe, etc.) • Ability to create trust governed by Delaware law but taxed as non-U.S. person during grantor’s life • Examples: trusts created by Asian clients to hold company stock and/or U.S. real property for benefit of offshore family members, or to hold assets that ultimately will pass to U.S. beneficiaries • Use of U.S. jurisdiction may provide greater certainty and confer “legitimacy”

  5. Areas for Discussion • Advantages of using common-law trust with Delaware “Directed Trustee” • Delaware statutory trusts: advantageous for financing transactions, but difficult to use as stand-alone entities for estate planning because of potential adverse estate-tax effect • Private Trust Companies

  6. When You ThinkTRUST,Think Fulbright.TM

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