The Nevis and Cook Island LLCs are both significantly more protective than domestic LLCs. As with the domestic LLC, a judgment creditor of an international LLC’s member is limited to a charging order against that debtor member’s profit distributions. Moreover, with the Nevis LLC, the creditor pays U.S. taxes on earnings attributable to the debtor-member from the Nevis LLC – even if earnings were not distributed by the Nevis LLC. This is the same with a domestic LLC. Moreover, the member’s creditor cannot claim the member’s interest in the LLC, nor replace its management. Most significantly, Nevis LLC law prevents a present creditor from pursuing fraudulent transfer claims against the debtor’s assets transferred to the Nevis LLC provided the debtor exchanged the contributed assets for a proportionate ownership interest in the LLC. This is not necessarily so with domestic LLCs. The international LLC, as a disregarded entity, requires minimal IRS reporting. Moreover, the Nevis LLC can be flexibly structured to achieve virtually any Asset Protection, estate planning, business or investment objective. The Nevis LLC, for U.S. tax purposes, can elect to be taxed either as a C corporation or partnership. Officers and directors of the Nevis LLC are personally immune from the LLCs liabilities. The Nevis or Cook Islands LLCs are excellent alternatives for those who want good protection internationally at less cost than forming an IAPT. However, we emphasize that you won’t save U.S. taxes with the Nevis LLC or any other international entity, as American taxpayers must report and pay US taxes on all international earnings in the year the income was earned.
