Private Interest Foundations: The Ultimate Guide to Protecting Your Wealth

Private Interest Foundations are legal entities created for the management and protection of assets or assets. Often, they are used in family estate planning and in protecting assets against claims, disputed inheritances, or to ensure the fulfillment of the founder's wishes in the long term.

In its basic structure, a Private Interest Foundation includes:

• The Founder: The person or entity that establishes the foundation.
• The Founding Act: A document in which the objectives, structure and management rules are established.
• The Foundation Council: A group of people or companies responsible for managing assets as stipulated.
• The Beneficiaries: The people designated as recipients of the benefits of managed assets.

An interesting peculiarity of this type of entity in countries such as Panama is the protection they offer against third-party claims and the high level of privacy for the founder and the beneficiaries.

Private Interest Foundations vs Corporations

While the societies are designed primarily for commercial and business activities, foundations focus on the conservation and management of personal or family assets. In addition, foundations do not generate profits directly, so the profits go exclusively to the objectives set by the founder and are less susceptible to corporate taxes.

Private Interest Foundations vs Trusts

Los trusts (or trusts, in English) and foundations share certain similarities, but they differ in their legal structure. A foundation is an autonomous entity that has its own legal personality, while a trust is an agreement between parties that is not an independent entity. In addition, foundations offer greater autonomy in modifying rules and managing assets.

Private Interest Foundations vs Nonprofit Foundations

Nonprofit foundations have strictly charitable or educational objectives. On the other hand, Private Interest Foundations may be oriented towards purely family goals, such as estate succession or the care of vulnerable family members.

• Asset Protection: Assets transferred to a foundation are not susceptible to garnishments or personal claims against the founder.
• Confidentiality: The identity of the founder and the beneficiaries is protected by the legislation of many countries, such as Panama.
• Efficient estate planning: They make it possible to manage the distribution of assets following the founder's wishes.
• Tax advantages: In several jurisdictions, foundations are exempt from taxes on profits generated outside the country.
• Flexibility: Internal rules and terms can be modified according to the changing needs of the family or founder.

These benefits make Private Interest Foundations especially attractive to entrepreneurs, wealthy families, or those seeking to optimize their family heritage.

If you're considering creating a Private Interest Foundation, it's important to know the general requirements:

1. Drafting the Founding Act: It includes information about the objectives of the foundation, the Foundation Council and the designated beneficiaries.
2. Register the foundation: It is necessary to register it at the tax address of the chosen jurisdiction (for example, Panama).
3. Appoint a Foundation Council: This body will be responsible for the administration and management of assets.
4. Contribute assets or initial capital: Although the amount may vary depending on the jurisdiction, in Panama it is usually minimal.
5. Registration in the Public Registry of Panama: Like corporations, Private Interest Foundations must also complete the registration process in the Public Registry of Panama.

At Limitless Legal, we offer personalized services to accompany you throughout the process, ensuring that you meet every legal requirement without complications.

Setting up a Private Interest Foundation may seem complex, but with the right support, the process is fully manageable. At Limitless Legal we have a team of lawyers specialized in estate planning, corporate law and asset protection, who will work with you to ensure that your foundation complies with all local and international regulations.

In addition, we offer you:

• Free initial consultation to analyze your legal needs.
• Fast and confidential services.
• Personalized attention and plans adapted to your specific objectives.

Don't take chances with inexperienced advisors. Protect your assets and the future of your loved ones with Limitless Legal, your best legal ally!