ASSET PROTECTION OVERVIEW The following information was compiled from various internet sites and is not to be construed

as legal, financial, or tax advice. You are responsible for yourself and your own actions. If you act on what you do not understand, and cannot support in law, the consequences are entirely yours.

History shows that the vast majority of those that come into unexpected or uncommon wealth are totally unprepared on how to deal with it. The first thing you need to do is to do your due diligence and learn how to protect yourself. Most people that come into this kind of wealth lose it very quickly because they are not prepared and have not done their research. Dont be one of them. Take your time and learn what you need to know. With this wealth, time is on your side. Take it easy and plan before you act.
If you have wealth, you need wealth protection. Just a few simple steps, plus some offshore advantages, can ensure your hard-earned assets remain yours and can be passed on to your family and loved ones. Moving some of your assets offshore provides you access to modern (and ancient) methods of protecting your assets and reducing your taxes using international corporations and foundations. Since this is not illegal: it therefore should not attract undue attention from the authorities. It is activities like money laundering, tax evasion and controlled accounts that the tax authorities are interested in, not law-abiding citizens protecting their assets and lowering their tax burdens.
THERE IS NOTHING ILLEGAL ABOUT MOVING ASSETS OFFSHORE. It is when you move

the assets into personal accounts offshore and do not declare their existence to the tax authorities that you break the law. Any assets you control, domestic or offshore, are probably liable to taxes in your home jurisdiction. Taxes must be paid on profits made on assets under your legal ownership. By the use of certain offshore entities, which vary according to your home jurisdiction, a certain proportion of your assets will no longer bear taxes at the same rate. Some people are quite happy to stay in a system which allows vultures to prey on exposed assets. That is their individual choice. There are other people who prefer to leave the country they love to get away from the system. Offshore asset protection is somewhere in between. There is nothing immoral in trying to protect your hard-earned assets so that you and/or your family can benefit from them later on. It is the essence of rational self-interest. Laws generally around the world do not require that you report any assets held in a foreign foundation. However, U.S. taxpayers should seek expert tax advice on this issue.

Asset Protection is a term used to describe the concept of legally transferring your assets into a legal entity which will protect them from attack by frivolous litigation, seizure from government, or attack from an estranged spouse; in fact, anything which may threaten your hard earned wealth. Most modern tax havens are very alike with respect to their tax laws and services, although some do offer entities not available in others. Certain tax havens have developed bad reputations over the years due to abuse by certain elements of the offshore industry, but most are quite safe. As with any financial plan:
IT IS USUALLY BEST TO USE A MIX OF JURISDICTIONS, PICKING THE BEST FROM THREE OR FOUR COUNTRIES.

Many people would like the safety of an offshore asset protection structure while keeping complete control over the assets, trading accounts etc. This is possible but gives a direct link to the assets and will probably lead to any legal structures that were set up being ignored for both tax and protection purposes.
OFFSHORE ASSET PROTECTION DOES REQUIRE THAT YOU FIND PEOPLE YOU TRUST TO ADVISE YOU AND TAKE CARE OF FINANCES FOR YOU.

One way to stay protected and completely confidential is to use a Private Interest Foundation which offers you complete confidentiality. In order to do this correctly, there cannot be a trace of any of the clients information on any of the public records. You can use a nominee foundation council for the Foundation, since all Panama entities require disclosure in the public registry of the required minimum three directors. According to the by-laws of the foundation, the Founder/Protector is not required to be registered publicly and therefore the Founder/Protector document can be kept private and confidential. A foundation is the secretive, offshore legal entity that most Americans never hear about. Its an independent fund that you set up specifically for your family. Unlike other legal entities, a foundation has no shareholders, owners, or members, just beneficiaries. You cannot set up a foundation in either U.S. or Canada. Only a handful of countries offer this unique asset protection tool, including Liechtenstein, Panama, St. Kitts & Nevis, and The Bahamas. And best of all, unlike a trust - you get to manage your own legal entitys assets if you set up a foundation. Once you set up a foundation for the benefit of your heirs, you actually have a say in your foundations investments. You dont have to consult a trustee, because you still have creative control. That means if you have the income to invest in a foundation, it can be more effective than a trust. However, you can ONLY set up a foundation for family members. So if you want to leave your fortune to your best friend from childhood, you should consider a trust instead.

WHILE YOURE CHOOSING THE BEST ONE MAKE SURE TO HIRE AN ATTORNEY OR OTHER OFFSHORE PROFESSIONAL WHO CAN DECIPHER THE REAL LEGALESE FOR YOU.

Once you establish an offshore PIF you need to be able to transfer funds to accomplish

investment objectives. An offshore IBC is a good vehicle for this purpose. If you are going to invest a large amount of funds, we normally recommend that you purchase a Private Annuity of equal value from the IBC in return for the funds you send to it. The reason for this is simple. If you just sends funds to the IBC without a reason or something in return of equal value, then the funds could be considered a gift, and therefore a gift tax could be imposed. When you send funds in return for the annuity of equal value, the transaction is a legitimate purchase of a Private Annuity from the IBC, and the funds are not taxed. This is a completely legal transaction and the funds in the annuity investment are deferred until you begin to receive payments from the annuity. The annuity can be arranged to begin making monthly payments in 5, 10,15, or 20 years. If you choose, you can also use the Annuity payments as a method of repatriating the funds back to their domestic country, although a tax consequence would then occur if the client chooses to do so.
ONCE THE FUNDS ARE IN THE IBC, THEY CAN BE DIRECTED OR INVESTED IN WHATEVER YOU WISH.

There are several techniques you can use to repatriate funds without a tax liability. ONE

WAY TO REPATRIATE A LARGE AMOUNT OF FUNDS AT ONE TIME IS TO OBTAIN THE FUNDS IN THE FORM OF A LOAN FROM THE IBC. You can arrange the loan in the form of

a balloon note payable in 20 years, then renegotiate the loan when the loan matures. This would be a completely legal transaction if structured properly, but should be verified with a tax expert in your own country of residence. Normally the loan would be backed by real estate equity, shares in their business, or some other form of collateral. A Private Annuity Contract (PAC) is a contractual arrangement between an individual, (referred to as the Annuitant), and an entity, that is not in the business of selling annuities, typically a foreign corporation (known as the Obligor). In a PAC transaction, the Annuitant transfers cash or other property to the foreign Obligor in exchange for the Obligors promise (which is documented by the annuity contract) to make periodic payments to the Annuitant for a specific number of years, usually for the remainder of the Annuitants life. Assets may be Appreciated Property and the recognition of any taxable gain (capital gains or ordinary income) inherent in the asset may be postponed even though the assets (stocks or real estate for example) may be cashed in and the funds invested elsewhere. The periodic payments, more commonly referred to as annuity payments, may be made to the Annuitant on a monthly, quarterly, semi-annual or annual basis. These payments may be deferred as long as the Annuitant wishes so that with appropriate estate planning the value of the appreciated foreign property may eventually be transferred to heirs and beneficiaries without the payment of estate tax. THE PAC OBLIGOR MAY INVEST
ANYWHERE IN THE WORLD, INCLUDING THE U.S., AND HAS INVESTMENT ADVANTAGES THAT ARE NOT OFFERED TO U.S. INVESTORS. For example, there are various tax

provisions only available to foreign persons that the US has enacted to encourage investment in the US and the use of U.S. banks and savings institutions. As a result, the PAC Obligor may invest tax-free in U.S. stocks and financial accounts. The Obligor may

sell appreciated stocks utilizing a PAC with no tax recognition and reinvest the funds back in the US on a private and tax-free basis. The PAC offers a wide range of benefits that no other single business and estate planning device can match. These include the following benefits: Income Tax Savings Similar to the taxation of installment sales, a PAC permits the Annuitant to defer gain on the sale of any type of property by spreading it over the life expectancy of the Annuitant and, in the case of a PAC subject to a term, over a stated term rather than reporting the entire amount of the gain in the year of sale. In the U.S. the Tax Reform Act of 1986 made installment sales much more difficult, and in many cases impossible. For example, installment sales are not allowed for certain assets, such as publicly traded stock. In contrast, a PAC permits the Annuitant to receive a tax deferral on any appreciated asset, including publicly traded stock. Appreciated assets may be transferred to the Annuity Obligor and converted into investment funds without payment of any income tax on capital gains or ordinary income. Estate Tax Savings A PAC ALSO ALLOWS THE REMOVAL OF THE TRANSFERRED PROPERTY FROM THE ANNUITANTS GROSS ESTATE WITHOUT TRIGGERING ANY U.S. GIFT TAX. Therefore, upon the death of the Annuitant, the transferred property as well as any future appreciation in such property will not be included in the decedents gross estate. If the annuity is a PAC based on a single life as opposed to two lives, the annuity payments are also excluded from the Annuitants gross estate for estate tax purposes. With appropriate estate planning, appreciated foreign investments may be passed to beneficiaries with estate tax consequences. Asset Protection Since property that is properly transferred in a PAC transaction is no longer considered owned by the Annuitant, the transferred property is beyond the reach of creditors and lawsuit or bankruptcy judgments. A PAC HOLDS PROPERTY AWAY FROM U.S. JURISDICTION, THUS PROVIDING AUTOMATIC ASSET PROTECTION AGAINST FUTURE CREDITORS, EX-SPOUSES, AND ATTACK FROM GOVERNMENT AGENCIES. Capital Gains Deferral One of the primary tax benefits of a PAC is its ability to defer payment of Capital Gains taxes. For example, the sale of appreciated capital assets normally requires the immediate and full payment of Capital Gains taxes in the year of the sale. If, instead, an individual transfers the capital assets in exchange for a PAC, only portions of the Capital Gains taxes

are paid in the year the annuity payments are actually received by the Annuitant. A 20year PAC could allow 20 years of Capital Gains tax deferral. Tax-Advantaged, Private International Investing Since property in a PAC transaction is transferred free of income taxes on capital gains or ordinary income (at least, until the annuity payments are received by the Annuitant), the transferred property can be used to earn greater investment returns. There is no reporting of the interim growth or U.S. tax payable at any time on PAC investments. Since taxes may be paid at some time in the future, when and if the Annuity is activated and funds flow back to the U.S., this investing is best called tax-advantaged. Well planned, investments may result in tax-free returns. Foreign investments can grow tax-free and in privacy. A PAC may invest anywhere in the world without the oversight of the U.S. Government. In contrast, U.S. Persons are not allowed to invest internationally unless the investment has been approved by the SEC. A HIGH PERCENTAGE OF THE MOST SUCCESSFUL MUTUAL FUND AND BANK INVESTMENTS ARE OUTSIDE NORTH AMERICA AND NOT AVAILABLE TO U.S. PERSONS. Flexibility of Use - Offshore Commerce A PAC can be structured to operate an international business venture, with indefinite life, and yet the profits are not taxed in North America unless they derive from business activity there. Lifetime Income Without Losing Family Control of Property A PAC is extremely useful for an Annuitant who desires the security of a fixed income for life and wants control of the asset or business to remain in the family but does not wish to exercise that control personally. By transferring property to a family member utilizing a PAC, the Annuitant is able to shift management of the property to descendants rather than waiting to bequeath it subject to the possible burden of estate taxes. Gift Tax Savings A PAC also allows the Annuitant to remove property from his gross estate without the loss of the unified tax credit. A PAC also provides financial security to the Annuitant since the annuity payments are fixed, usually, over the life of the Annuitant.
ASSETS TO THEIR INTENDED HEIRS WHILE AVOIDING DISQUALIFICATION FOR FEDERAL OR STATE ASSISTANCE.

In anticipation of a catastrophic illness or escalating medical costs due to old age, a person may want to transfer property to prospective heirs in order to minimize the amount of shrinkage that will occur in the estate due to medical, hospital or institutional

costs. Retaining assets or an outright gift of assets may disqualify that individual for federal or state assistance (i.e., Medicaid, Medi-Cal, etc.). IN CERTAIN CASES, THE PAC

MAY BE USED TO ALLOW A CLIENT TO DISPOSE OF THESE ASSETS TO THEIR INTENDED HEIRS WHILE AVOIDING DISQUALIFICATION FOR FEDERAL OR STATE ASSISTANCE. SUMMARY

1. Real financial privacy is only available offshore. So plan on banking in a jurisdiction where your financial privacy is guaranteed by law. That means the local bankers or other financial professionals you work with could face criminal penalties if they reveal personal information about your finances to anyone. Liechtenstein, Austria, Switzerland, and even Singapore have such laws in place. 2. Dont give your government a reason to suspect you, by trying to cheat the taxman. Maintain reporting requirements by disclosing all your domestic AND offshore transactions to your native country. SEEK PROFESSIONAL ADVICE TO MAKE SURE
YOURE KEEPING UP WITH THE LATEST REOUIREMENTS.

3. GOING OFFSHORE ADDS ANOTHER LAYER OF PROTECTION. Whether its in a life insurance wrapper, retirement annuity or asset protection trust, placing your assets offshore puts them out of reach of most frivolous lawsuits. Even litigants with an ax to grind may be ready to settle for pennies on the dollar when they find out how difficult it is to locate and attempt to collect your money offshore. If you invest your retirement plan in a suitable jurisdiction - Switzerland for instance - it can be configured to be essentially claim and judgment-proof. 4. AVOID GENERAL PARTNERSHIPS. In this form of business, youre personally liable for all debts or other business liabilities the partnership incurs. Any general partner can commit the partnership (and hence every other general partner) to any legal contract (like taking out a loan). In todays litigious society, its a high-risk way of doing business. 5. GET GOOD ADVICE. Avoid pushy offshore hucksters who claim falsely that you can lower your tax bill to zero if you just put all your money in their Pure Trust, a Constitutional Trust or a Corporation Sole. Well, you might not pay any taxes, but only because these hoodwinkers will take all your money and run. And you could go to jail. Instead, work with carefully vetted bankers, investment advisors, financial experts, and legal professionals from select tax and asset haven jurisdictions. Always check references and do your homework on a service provider before sending them a single penny. 6. PASS ON YOUR LEGACY WITH AN OFFSHORE TRUST. In most cases, while an Offshore Trust will protect your assets, it wont reduce your tax bill. However, an Offshore Trust can incorporate provisions that can reduce future estate tax liability. It can protect your

wealth, notwithstanding efforts by the U.S. or other governments, to discourage legal offshore financial transactions and investments. Frivolous litigation, expensive legal defense costs, outrageous jury awards, and government privacy invasions all create an urgent need to protect your family and business wealth. An APT can do all that and more. One important point to keep in mind; Offshore Trusts are effective only if the creator relinquishes all control over the trust, its assets and the trustee. Otherwise the APT may be declared to be a sham by a court or by the IRS or both. 7. FILE ALL REQUIRED RETURNS AND REPORTS. A certain path to asset loss is ignoring U.S. tax filing and reporting requirements or giving inaccurate or partial information. Virtually every nation now has know your customer laws that require bank account applicants to prove their identity, the source of their funds and their life story. Cash transfers of US $10,000 or more are reported electronically to the U.S. government. U.S. persons must say on their 1040 if they have an offshore account, and if activity therein exceeds U.S. $10,000 annually. U.S. Treasury Form TDF 90-22.1 must be filed. Lying and failure to file these reports are separate felonies.

Good Reasons for an Independent Asset Manager The following was taken from the Sovereign Society Newsletter and is a definite must for those of us going offshore. Having an offshore bank account is a good thing. How you can use it to your best advantage is another. That's where an Independent Asset Manager (IAM) comes in. In Switzerland alone, there are about 8,000 IAMs that manage an estimated US$5 trillion to US$7 trillion. There's a reason Swiss IAMs attract such large sums; they're good at what they do, and fill a need. The Sovereign Society has always recommend that wealthy families should have part of their wealth outside of their home country --and the Society lists Switzerland as their #1 choice for an offshore haven. There are numerous advantages to that course of action. Advantage #1 IAMs are usually small operations, which means they can build individual portfolios for each client. Most banks will try to put customers in one of three categories -aggressive, not aggressive, or in between. However, IAMs can create portfolios that have gold only stocks or bonds only, depending on the individual client's needs and wishes. Advantage #2 IAMs get to know clients on a very personal basis. Customers aren't just numbers. For example, my firm has only four employees and 130 to 150 clients

worldwide. A good IAM will call each client at the end of every quarter; tell them what's been going on in the last three months, and what's likely to happen next. But small size doesn't mean limited service. The big Swiss banks act as back offices for IAMs. Every transaction statement is produced by the bank and sent to the client and the IAM. Advantage #3 A good IAM stays at his job. The owner-operators of IAMs tend to stay in their positions for many years, since they're operating their own business. If a UBS banker gets a better offer at Credit Suisse, he's probably gone. Advantage #4 IAMs don't have to trade like big institutions. We have the guts to say we don't like the market. A bank will usually be fully invested. Banks just don't have the agility to switch positions the way we can. We never change the core holdings. But we do use options to hedge. Advantage #5 is personal service. If a client flies into Switzerland, an IAM is usually happy to pick them up at the airport, get them a hotel, meet them at the hotel, and set up meetings with bankers and spend time with them. We do it all the time. Advantage #6 is privacy. It's still very difficult to gain information on Swiss bank accounts, and that strict secrecy has been protected by law since 1934. Advantage #7 is trust. A good IAM works with his clients to analyze their needs, based on factors such as age, health, temperament, investment experience, personal preferences, individual circumstances, and family. Once trust is established, a client can sign a limited power of attorney allowing the IAM to trade the account as he sees fit to build a portfolio to best suit the customer. And that brings us to the last advantage... Advantage #8 it simplifies your life. Since you've handed over limited power of attorney to your IAM, you don't have to devote time to building your own portfolio and monitoring your positions on a daily basis. A good IAM stays in touch with a client to see if circumstances change and if the client is satisfied with the performance of his or her portfolio. Since the 1% management fee our client pays us is our lifeline, we go out of our way to make them happy. IAMs have definite personalities -- some are conservative, others favor a more aggressive investing style. You can find the one that's a good fit for you and the Sovereign Society will help you. Robert Vrijhof Weber, Hartmann, Vrijhof & Partners. Ltd., Zurichstrasse HOB, CH-8134 Adliswil. Zurich, Switzerland. Tel: +(41) 44-709-1115 E-mail: [email protected] Web site: http://www.whvp.ch

SAMPLE PROMISSORY NOTE

Also, check out this link for helpful info and other sample Promissory Notes. http://www.10minutelegalforms.com/promissory-notes.htm

Promissory Note
$ 100,000.00 [Podunk, New Jersey] February 30, 2020

For VALUE RECEIVED, the undersigned (jointly and severally, if more than one) promises to pay to Acme Capital IBC the principal sum of One Hundred thousand and 00/100 DOLLARS, ($100,000.00). Note shall be non-interest bearing and principal shall be payable in lawful money of the United States of America, in one balloon payment, at the end of the agreed term, and at such place as may hereafter be designated by written notice from the holder to the maker hereof. Term of note is for a period of twenty (20) years, renewable at the end of that term, upon mutual agreement. This Note may be prepaid in whole or in part at any time without penalty or premium.

Maker's Name Makers Address

_Bernard T. Schwartz____________

_135 Whodathunkit Ave___________ __Podunk, NJ 03030_____________ ______________________________

Makers Signature _Bernard

T. Schwartz________

________________________________

FREQUENTLY ASKED QUESTIONS

Isn't Moving Assets Offshore Illegal? There is nothing illegal about moving assets offshore. It is when you move the assets into accounts offshore and do not declare their existence to the tax authorities that you break the law. Any assets which you control domestic or offshore are probably liable for taxes in your home jurisdiction. Why Should I Move Offshore? Moving some of your assets offshore provides you access to modern (and ancient) methods of protecting your assets and reducing your taxes using international corporations and foundations. What Is Asset Protection? Asset Protection is a term used to describe the concept of legally transferring your assets into a legal entity which will protect them from attack by frivolous litigation, seizure from government, attack from an estranged spouse - in fact anything which may threaten your hard-earned wealth. If I Must Declare My Offshore Assets, How Can I Use an Offshore Plan to Legitimately Reduce My Taxes? Taxes must be paid on profits made on assets under your legal ownership. By the use of certain offshore entities, which vary according to your home jurisdiction, a certain proportion of your assets will no longer bear taxes at the same rate. Ive Heard That Offshore Asset Protection Is Immoral. Some people are quite happy to stay in a system which allows vultures to prey on exposed assets. That is their individual choice. There are other people who prefer to leave the country they love to get away from the system. Offshore asset protection is somewhere in between. There is nothing immoral in trying to protect your hard-earned assets so that you and/or your family can benefit from them later on. It is the essence of rational self-interest. Which Is the Best Offshore Center To Use For Asset Protection and/or Estate Planning? Most modern tax havens are very alike with respect to their tax laws and services, although some do offer entities not available in others. Certain tax havens have developed bad reputations over the years due to abuse by certain elements of the offshore industry, but most are quite safe. As with any financial plan, it is usually best to use a mix of jurisdictions, picking the best from three or four areas. Can I Retain Control Over My Money, Possibly Through Investment or Bank Accounts in My Home Jurisdiction?

Many people would like the 'safety' of an offshore asset protection structure but would like to keep complete control over the assets, trading accounts etc. This is possible but gives a direct link to the assets and will probably lead to any legal structures that were set up being ignored for both tax and protection purposes. Offshore asset protection does require you find people you trust to advise you and take care of finances for you. How Much Does an Asset Protection Structure Cost? At Sovereign Management Services S.A. we believe in providing value for money for our clients. Furthermore, when providing our services, our focus is on building the quality and value of relationships with our clients over an extended period of time. Basic asset protection structures start as low as US$1500 for an average family, with annual costs as low as US$500. Of course this cost rises with the complexity involved and whether or not you are looking to take advantage of our professional management and account signatory services. What Is the Minimum Amount I Should Start With? That depends on your reasons for going offshore. If it is for asset protection you should be considering how much you are risking by not going offshore, namely lawyers fees, time, loss of assets etc. If it is for tax reasons you should be looking at the annual costs against how much tax you can save. Our Offshore Identity Package is designed as an absolute minimum, but depending on your requirements you should take a good look at the more comprehensive packages and their resulting benefits. Are There Any Other Advantages to Going Offshore? Once a structure has been legally created it can be used for international trade and investment. This opens up a whole new arena that the average unstructured citizen cannot usually access. What Is an Offshore Corporation? A corporation is an entity recognized by law as a separate "person" with limited liability. A corporation has the option to sell shares, the right to sue and be sued, and has perpetual existence. How Are Offshore Corporations Used? Offshore corporations may be used to own and operate businesses, issue shares, bonds or otherwise raise capital, guarantee obligations, hire employees, buy goods and services, sell goods and services, make contracts, rent office space, maintain checking and saving accounts, and maintain retirement plans for employees. Although most offshore corporations are private and closely held, some are publicly traded on major stock exchanges. What Are Articles of Incorporation? The Articles of Incorporation is the document which establishes the corporation and contains basic information such as the name, share structure, and purpose of the corporation.

What Are By-Laws? The By-laws, or in some jurisdictions "Articles of Association", are rules the corporation creates for its shareholders, officers, and directors. By-laws are adopted by the Board of Directors as one of the first organizational steps in setting up a corporation. Upon instruction, we can adopt a standard set of By-laws for a new corporation. Unlike Articles of Association, By-laws are usually maintained internally but may be publicly filed if requested. What Does a Corporate Search Reveal? A corporate search will reveal the name of the corporation, the date of existence, amendments, and any other publicly filed document. For instance, under Nevis law there is no requirement that the names of corporate officers, directors or shareholders be filed in any public registry. Such information, therefore, remains confidential. The requirements under Panama law are a little different which is solved through the use of nominees as directors and shareholders. What Are Bearer Shares? Bearer share certificates do not indicate the name of the owner. The certificate is endorsed in blank such that the person having physical possession of the document is the owner. Bearer shares facilitate the transfer of assets because transfer of ownership is accomplished simply by the transfer of the certificate. As a rule, it is not advisable to use bearer shares because of the negative connotation in the eyes of judges and lawmakers. What Are Registered Shares? Registered share certificates indicate the name of the owner on the document. As a rule, the use of the Panamanian Foundation to be the owner of the share certificates is a recommended solution. The name of the shareholder is also recorded in the internal corporate records of the company. Although the registered owner is recorded in the corporation's internal records, no public registry of shareholders is maintained. The share registry is an internal corporate document available only to directors, officers and shareholders, under conditions specified in the jurisdiction's corporate statute. What Are Shelf Companies? Shelf Companies are ready-made, never used corporations that have been created to meet a client's immediate needs. What Is a Registered Agent? A Registered Agent is required to ensure that the corporation has an assigned representative at a known address to receive all service of process (legal notices) on its behalf. The Registered Agent forwards these documents to the address of record of the corporation.