Question:

About trust funds: If someone wants to set up a trust fund for someone in a different country, how is it done?

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Should the person, if possible, just go to the country where the recipient of the fund are (e.g. Canada), and make one at a bank there? Or should they make one in the States, and worry about getting it to the recipients when the time comes? In this particular case it would be easier for the person creating the trust to create it in the States using an American bank! LOL

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  1. To reliably direct money to someone after you die, you will need a will or a trust.  A trust usually requires a lawyer, and is more expensive than a will drawn up by a lawyer, but offers certain advantages.  When a person who is not an American citizen inherits a large amount of money in the U.S., there are additional provisions in the tax code that restrict them from freely removing the money from the country to try and ensure that the IRS gets the taxes they are entitled to.

    The simplest way to avoid wills and trusts would be to name them as a beneficiary on a bank account or other investment account you own.  When you die and they document that with a death certificate, they will own the bank account, brokerage account, etc.  This could be done in the U.S. or in the country they live in.  See my link regarding "payable on death" bank accounts.  

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