Does Your Trust Still Work if You Live Abroad?

By Aoifinn Devitt, Managing Director – Global Wealth 

Most trusts are created to reflect a family’s circumstances at a specific point in time. Over the years, though, families change. Marriages, divorces, new children, relocations, and other major life events can leave an older trust out of step with the people and goals it was designed to support.

The primary focus of every trust strategy should be to design a structure that achieves your long-term goals while remaining flexible enough to evolve with the circumstances of your life. U.S. citizens who live abroad or non-U.S. citizens who hold U.S. trusts and other assets often wonder how living in other jurisdiction comes into play. In most cases, a trust’s legal structure will work in different locations around the world, but for families with assets, beneficiaries, or roots in more than one country, the question of whether a trust is still working as intended is more complex, and more consequential than most realize.

The nuance of trust jurisdiction and tax obligations

When it comes to tax obligations, where a trust is located doesn’t shield U.S. citizens from U.S. requirements. If you are a U.S. citizen, tax reporting requirements follow you no matter where you live or where you open a trust. Tax protective structures in non-U.S. jurisdictions will not eliminate the scrutiny of the U.S. tax authorities when it comes to your U.S. tax return. It’s important for U.S. citizens abroad to have two sets of advisors; a set that is fluent in the local tax and estate provisions and a set that is conversant in your U.S. tax and estate provisions.

For non-U.S. citizens who hold U.S. assets or non-U.S. spouses that inherit assets, tax withholding could apply. That is usually factored into the natural return expected on that asset. The estate tax exemption threshold that applies to U.S. citizens does not apply to non-U.S. citizens in the same way. A non-U.S. citizen that owns U.S. assets is subject to U.S. estate tax at a much lower threshold than a U.S. citizen.

This difference could affect how and the order in which you liquidate assets. It’s important to think strategically at both stages of your financial life—as you build and enjoy the return on a portfolio, and as you spend it down. Non-U.S. citizens, and particularly a non-U.S. citizen spouse that inherits from a U.S. citizen spouse, should think carefully about where they hold assets and in what order they are liquidated, as the sequence of those decisions can determine whether estate taxes are triggered at all.

The specific risks global families face

Many civil law countries, such as France, Germany and some Latin American countries, have a different attitude towards trusts. They consider trusts to be a way of tax avoidance or evasion, and in some cases will not recognize them at all. For families with beneficiaries or assets in these jurisdictions, this makes it essential to carefully consider all of the building blocks of their broader estate architecture including the different currencies they hold and the estate tax implications of the assets in every country in which they own them.

U.S. expats should remember they will have tax reporting obligations in more than one jurisdiction and that a trust in one country is not necessarily recognized in another.

Finally, a common mistake that arises is the idea that there is one investment regime that is applicable around the world. There is not. You can’t choose to take advantage of different tax benefits and structures in different jurisdictions.

For example, there are several tax efficient structures in the U.K. which do not apply to U.S. citizens. U.S. citizens, therefore, cannot avail of the advice that those local advisers may give them, because so many of the structures will not apply. The bottom line is for U.S. citizens abroad, ultimately the U.S. tax obligations will reign supreme.

Coordinating lead counsel and local counsel

Living as an expatriate typically demands a nuanced approach from an advisor that is well versed in the complexity that accompanies that lifestyle. Tax advisors should be fluent across both jurisdictions, particularly the U.S. reporting requirements.

Families can also benefit from having an advisor with a commercial sense that knows the thresholds and how to optimize working within them. They can identify ways to optimize your tax situation in the jurisdiction and help ensure that your approach isn’t the most risk-averse and restrictive.

To choose the right advisor, carefully assess which advisor fits your:

• risk tolerance 

• commercial savviness 

• essential experience in different jurisdictions and professions 

Finally, pay attention to your team’s communication and understanding of jurisdictional norms. Coordination can often break down between counsel when they don’t align in these areas. Misaligned expectations around the timeliness and manner of communication — even between advisors who share a common language — can cause substantial problems. This is why an advisor’s cultural fluency matters as much as their technical fluency.

Successful investing abroad requires personal education

Having the right advisors in place is only part of the equation. Families who navigate global complexity successfully also take ownership of their own financial education. In these countries, approaches and thresholds for matters like inheritance tax, healthcare, taxes, and even philanthropy can vary significantly. Learning as much as possible about options available and best practices for investing globally is one of the most valuable things a family can do. Common core touchstones that can allow a family to stay grounded amid volatility and complexity include:

• Staying the course 

• Staying diversified  

• Staying true to your values  

• Stating your values as a family clearly and well understood by all  

• Restating your values frequently.  

Legal terminologies, legal structures, and regulatory backdrops change in a very dynamic way. Trusts are not “set it and forget it.” Families can find success by evolving with changing circumstances and being active, engaged participants in this journey and by asking questions and requesting customization and modifications. Just as you have a physical health check on a regular basis, a financial health check should involve a scan of these documents to assess whether they are still fit for your current purpose.

Partnering with an advisor can help you see the big picture

Often families don’t know all of the questions they should ask; or they come into the process once trusts have already been established. They might be tempted to use AI to create or alter trusts, but that direction comes with risks. The legal advice offered online can be general and not suited to your specific purpose, leaving you with distress or an even greater expense in the long run.

An advisor can help you examine why your trusts were established, what they are intended to achieve, and how they can support current and future family members. They can make appropriate modifications as your circumstances evolve, and account for things AI cannot, such as cultural norms and expectations, family history, and the emotional dynamics that shape every family’s situation. An advisor can also gauge when it’s appropriate to bring in a legal specialist. If a family wants to provide support to a family member with special needs, for example, that requires another layer of careful consideration and a different kind of expertise.

Not sure whether your trust has kept pace with your life? You don’t have to figure it out alone. Connect with a Moneta advisor below. The first conversation is simply about understanding where you are—in the world and in your estate plans.

Frequently Asked Questions

© 2026 Advisory services offered by Moneta Group Investment Advisors, LLC, (“MGIA”) an investment adviser registered with the Securities and Exchange Commission (“SEC”). MGIA is a wholly owned subsidiary of Moneta Group, LLC. Registration as an investment adviser does not imply a certain level of skill or training. The information contained herein is for informational purposes only, is not intended to be comprehensive or exclusive, and is based on materials deemed reliable, but the accuracy of which has not been verified. Trademarks and copyrights of materials referenced herein are the property of their respective owners. Index returns reflect total return, assuming reinvestment of dividends and interest. The returns do not reflect the effect of taxes and/or fees that an investor would incur. Examples contained herein are for illustrative purposes only based on generic assumptions. Given the dynamic nature of the subject matter and the environment in which this communication was written, the information contained herein is subject to change. This is not an offer to sell or buy securities, nor does it represent any specific recommendation. You should consult with an appropriately credentialed professional before making any financial, investment, tax or legal decision. An index is an unmanaged portfolio of specified securities and does not reflect any initial or ongoing expenses nor can it be invested in directly. Past performance is not indicative of future returns. All investments are subject to a risk of loss. Diversification and strategic asset allocation do not assure profit or protect against loss in declining markets. These materials do not take into consideration your personal circumstances, financial or otherwise.