Can a U.S. Creditor Reach My Foreign Inheritance Deposited in a Foreign Bank?

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Keeping creditors from snatching money from just any bank account is important for many. There are many states that have authorized protections from one branch of the United States bank with access to the corresponding institution in another country.

Some of these regulations have deemed these other banks and separate entities are cannot be levied against due to this.

However, if the bank does not exist in the country, this may be considered an entirely different matter. First, the person affected must understand the terms of the judgment that requires payment. If it stipulates that the individual must pay through any of his or her financial institutions, this may also affect credit cards, credit unions and other establishments.

Obtaining a foreign bank account may provide the protection someone is looking for in safeguarding assets from the United States Government. The Internal Revenue Service is capable of freezing the funds or bank accounts of someone, but this is only within the country. There are paths available to governmental agencies in acquiring the money a person places in other country accounts, but this usually requires assistance with the corresponding officials in the other land. This may or may not occur, and this means there is time to protect the assets until the judgment is resolved or the funds may be moved elsewhere.

Foreign Bank Account Use

Because the IRS has the ability to freeze the assets in a United States bank, it is often beneficial at least temporarily to seek the use of a foreign bank. If a judgment that demands funds is levied upon a person, this may be one of the first best steps to take in order to protect the assets and funds of a United States citizen. However, as long as the person remains a citizen under the country, if the other land permits the United States government to incur a seizure of the monies, the individual may find his or her finances severely lowered. These actions do take time, if the country permits them, and it is still possible to seek an alternative in the meantime.


There are certain investments with foreign items such as gold or establishments that may provide a way to keep creditors away. The accrued profits may be used to increase the investment or placed in a bank in different location than the United States. While this may be an affront to the country’s standards when considering other lands having gold or any investment in foreign gold, it may keep the IRS and other agencies away from the inherited assets. Gold investments may be more difficult to procure, but they are often more rewarding than others. However, it is still possible to enter into a profit-sharing scheme that only provides income during certain periods.

An Annuity

It is possible to shift funds into an annuity such as one the Swiss provide. This may be tax deferrable, and it could hide the assets obtained by a party until they are cashed out. If all else fails, this may be a route to take in order to mask how much revenue or income a person has when he or she has been given money from a foreign individual. These are long standing financial plans and are considered legitimate. These are also highly protected from lawsuits and creditors seeking to take money from the person that has the judgment on him or her.

Foreign Real Estate Investments

If a foreign bank has only so long before the fund are breached, the individual may consider placing the money into owning real estate or investing in someone else’s real estate holdings. It is best to seek property with greater value which is highly dependent on economic conditions of the country selected. This method is also greatly protected from the United States in seizing the assets. Where foreign bank accounts could be compelled to shift the funds to the American courts for paying off a judgment, real estate has no such rules or regulations in place.

Contact a Lawyer

If all else fails and the person has no idea what to do next, it may be beneficial to seek the counsel of a lawyer. This should be a legal professional that has experience and knowledge of both the United States tax, debt and credit regulations as well as the country where the funds reside. He or she may suggest one or multiple options in placing the assets until the judgment has been satisfied.


Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.

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