Bringing It HomeBringing It Home

Andrew Auchincloss

Planning for an existing foreign non-grantor trust that has one or more U.S. beneficiaries presents complex challenges for trustees and professional advisors. Merely understanding the relevant U.S. tax and reporting rules is daunting enough. But, trustees and advisors must proceed further and incorporate these difficult rules into the overall fiduciary decision-making process on appropriate investment and distributional policies for the trust.¹ While abundant literature exists on the details of the U.S. tax rules applicable to a foreign non-grantor trust,² little or no guidance is available regarding how the U.S. tax rules tend to interact over time with a trust's investment allocation and distributional policies, or wh...