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Move Your IRA and 401K Offshore 

Protect your IRA by taking it offshore.

Many individuals have a significant amount of their overall liquid assets in their retirement accounts. In fact, in many cases, retirement accounts constitute the single largest liquid asset that a person or couple has. As such, in the event of political turmoil, economic problems or fiscal instability (of governments or banks and brokers, or both) having all of your proverbial retirement eggs in one basket could be a costly mistake.  A lifetime of savings and investments could be wiped out, confiscated or devalued overnight.  Fortunately, moving retirement assets to a different jurisdiction protects them from exactly these kinds of scenarios.  Retirement assets held offshore are held in a different country which protects them from domestic turmoil and instability.  Moving retirement accounts to a different locale ensures that they remain safely in the client’s control, no matter what happens domestically.

Accordingly, it may be a pleasant surprise to learn that U.S. retirement accounts such as an IRA (Individual Retirement Account), 401K or 403B can be moved completely offshore. The good news is, moving your retirement account offshore is not only simple and straightforward to accomplish, it's easier than you think.  And the best part is: Transferring part or all of a U.S. retirement account offshore does NOT create any tax consequences, but the tax advantages of retirement accounts remain intact.  From the standpoint of taxation, moving part or all of your retirement accounts offshore is no different (again from a tax standpoint) than moving an IRA from one broker to another (for example from Fidelity to Schwab). 

Moving your retirement account offshore GREATLY increases your control and opens up a new world of investment possibilities.

Control of your retirement funds is yours and yours alone. When an IRA (or 401K or 403B) is moved offshore, the client (that's you) is the sole signatory on any offshore bank, brokerage or precious metals accounts.  As such, you maintain complete control over the accounts and all banking and investment decisions.  

An IRA (or 401K or 403B) that has been moved offshore may buy or sell any investment anywhere on the planet.  This includes U.S. and international stocks, bonds, options, futures, Forex, ETF's and mutual funds - basically any investment traded on any major exchange anywhere in the world.  An offshore IRA (or 401K or 403B) can also invest in offshore hedge funds, precious metals, international real estate, private businesses of any and all types (even fractional ownership of Panamanian mango co-operative farms!) and own vehicles including cars, boats and airplanes outright or in part. Additionally, offshore retirement funds can be professionally managed by some of the top offshore investment management firms.  Moving an IRA (or 401K or 403B) offshore not only opens up investment options that are nearly limitless, but these opportunities are simply not possible through a standard retirement account held at a traditional U.S. broker.

How an IRA (and 401K, 403B) is moved offshore.

The short explanation is: A new Self-Directed IRA is opened. An offshore company is formed that will be owned by the Self-Directed IRA and will be used to open offshore accounts. Once those offshore accounts are opened, the client can transfer retirement accounts offshore.  That's it - it's that simple.  We created the "Move Your IRA Offshore Package" which includes everything needed to do just that. You can see the Package at Services and Fees or go through the Offshore Planning Center and customize it.  

However, we understand that most of our clients want to thoroughly understand the entire process and each individual step. So here it is: The complete, step-by-step, detailed explanation of how to move a retirement account offshore.  

1.  A Self-Directed IRA account is opened with an IRA custodian that will facilitate international transactions.  A Self-Directed IRA is a specific type of an IRA that is designed to give the client maximum control over his or her retirement account and the investments in it. In practical terms this means that the client, not a broker, decides what kinds of investments (stocks, hedge funds, real estate, private businesses, etc.) the IRA will hold and most importantly, where these investments will be located.  Secondly, the IRA custodian must be willing to assist with foreign transactions. Most custodians will not.  Accordingly, when HFS assists clients with moving their retirement accounts offshore, we only use custodians that will specifically facilitate international transactions. 

2.  An offshore company (also known as an International Business Company, IBC or offshore corporation) is incorporated.  The offshore company will be owned by the Self-Directed IRA account that was just established.  It may seem unusual for an "account" to own a company.  But legally speaking an IRA account is technically a trust and therefore it can own assets such as the shares of a company.  Again, legally speaking, a Self-Directed IRA can own the shares of a private company (in this case the offshore company) just like it can own the shares of a publically traded company such as Google, Microsoft, Apple, Ford, etc.  

The offshore company must be set up so that it can act as the Self-Directed IRA's international banking arm.  The offshore company is the primary tool that will be used to open offshore bank accounts and investment accounts, purchase international real estate, make investments into offshore hedge funds and private businesses, own vehicles or make any other type of investment of the client's choosing. The reason for this is simple: Foreign (offshore) banks and brokers cannot open an account for an IRA directly.  But they can open accounts for offshore companies.  Therefore, any foreign accounts must be opened in the name of the offshore company.  Similarly, foreign property purchases or other alternative investments must be made in the name of the offshore company because, for example, an IRA can't directly purchase property in The Bahamas.  Stated a different way, the offshore company's sole purpose is to facilitate the opening of offshore accounts (and the purchase of alternative investments) because those accounts can't be opened directly by the Self-Directed IRA.  

3.  Offshore bank, brokerage or precious metals accounts are opened in the name of the offshore company.  As mentioned above, the offshore company is the tool that is used to open offshore accounts and make any other type of offshore investment. Once the offshore company has been set up, offshore accounts can be opened in its name.  And once those offshore accounts are opened, retirement funds can then be transferred into them. As with any offshore account opened in the name of an offshore company, the client is the sole signatory on the account. As the sole signatory, the client makes all the investment decisions and can buy or sell any investment that he or she sees fit. 

4.  The client transfers funds from existing retirement accounts to the new Self-Directed IRA account.  Once the previous steps have been put in place - the new Self-Directed IRA has been established, the offshore company has been incorporated and offshore accounts have been opened - the client can start moving funds offshore. The first step is to transfer funds from existing IRA accounts into the new Self-Directed IRA account. The transfer is typically made via ACH or wire transfer.  Moving funds from a 401K or 403B account is accomplished via a rollover into the Self-Directed IRA account, again typically via ACH or wire transfer.  

5.  Funds are wire transferred from the Self-Directed IRA account to the offshore accounts that have been opened in the name of the offshore company.  As soon as funds arrive in the Self-Directed IRA account, they can be sent offshore immediately.  This is accomplished via wire transfer from the Self-Directed IRA account to the offshore account(s).    

6.  Your retirement assets are now safe and protected and can be invested as you see fit.  Once the wire transfer from the Self-Directed IRA account arrives at the offshore bank or brokerage, your retirement assets have been moved offshore. They are in your hands and they will stay there.  And, you may now make investments of whatever type you want in whatever location that you like.  

HFS will oversee the entire process of helping you move your retirement assets offshore.  We have created a package that includes all of the above services (a Self-Directed IRA account, an offshore company and offshore bank and investment accounts) in one place. The Move Your IRA Offshore Package includes everything needed to move your IRA or 401K offshore.  We set up each item and assist you with the process one step at a time.  

Order the package directly from the Services and Fees page or Contact Us for a free consultation.

Visit the Offshore Planning Center to customize the IRA Package to your specific needs.


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