What the Panama foundation under Law 25 of 1995 really does for succession, privacy and asset protection — including the US tax reporting questions every serious founder should ask before signing anything.
The Panama Private Interest Foundation is not a company and not a trust — it is a legal entity that owns its own assets for defined beneficiaries, created by Law 25 of 1995 and recognized worldwide.
We handle the complete structure: charter, foundation council, protector, private regulations and ongoing administration — and we address the questions that cheap incorporators avoid: home-country reporting, substance, and whether a foundation is actually the right vehicle for you.
Deep insight into Panama's tax authority processes.
Master in Public Administration — law, economics and policy.
You always deal directly with the attorney handling your case.
Licensed attorney in the Republic of Panama.
“A Panama foundation separates ownership from control in a uniquely effective way — the founder can guide without owning, and assets are protected without being hidden.”
— Lic. José Manuel Góndola Escudero · Panama Bar No. 17,005| Piece | What it is | Notes |
|---|---|---|
| Founder | Who creates and endows the foundation | Can be an individual or an entity |
| Foundation charter | The registered constitutive document | Name, purpose, council, basic rules — public |
| Foundation council | Administers the foundation | Individuals or an entity; duties defined in the charter |
| Protector | Optional oversight figure | Often the founder or a trusted person; powers defined privately |
| Private regulations | Beneficiaries and distribution rules | Not publicly registered — the privacy layer |
| Assets | What the foundation owns | Real estate, shares, accounts, investments — in or outside Panama |
The US tax conversation, honestly. For US persons a Panama foundation is legal and reportable: depending on its design it is analyzed under the foreign trust or foreign entity rules, with reporting forms commonly in play (3520/3520-A, FBAR, and others by classification). We design the Panama side with that analysis in mind and coordinate directly with your US tax advisor — the structure must work in both countries, or it doesn't work at all.
Taxes in Panama. Panama's territorial system generally leaves the foundation's foreign-source income outside Panama income tax. Where the foundation forms part of a multinational group holding foreign passive income, the economic substance rules of Law 526 of 2026 (effective fiscal year 2027) should be part of the design review. Compare structures on our asset protection page.
Charter drafting, registration, council and registered agent — complete.
Beneficiaries, distributions and contingencies drafted for your family reality.
Governance that balances your control with real protection.
Real estate, shares and accounts endowed to the foundation correctly.
Work with your US or home-country tax advisor so the structure reports cleanly.
Resident agent, amendments, successor planning and annual upkeep.
Your goals, family map and home-country obligations — before any document.
We draft the public charter and the private regulations to match.
The foundation is registered and assets are transferred in.
Governance support, changes and succession events over time.
Foundation as the succession hub, with private regulations handling each branch of the family.
Foundation designed alongside the client's US CPA for clean annual reporting.
Assets endowed early and governance set so protection holds when tested.
A legal entity created under Law 25 of 1995 that owns assets for the benefit of designated beneficiaries. It has no shareholders and no owners: the founder endows it, a foundation council administers it, and beneficiaries receive from it. It is Panama's signature vehicle for succession and asset protection.
A corporation has shareholders who own it; a trust is a contract where a trustee holds assets (in Panama, under Law 1 of 1984). The foundation is neither: it is its own owner. That separation — nobody owns the foundation — is what makes it powerful for succession and protection planning.
Yes — but it is reportable. US persons must disclose foreign structures to the IRS, and a Panama foundation is typically analyzed under the foreign trust or foreign entity rules, with forms commonly discussed including 3520/3520-A, FBAR and others depending on classification. We structure the Panama side and coordinate with your US tax advisor — a foundation used for hiding income is the wrong tool and the wrong client.
The charter (registered) contains the foundation's name, purpose, council and basic rules. The sensitive details — beneficiaries, distribution instructions — usually live in private regulations that are not registered publicly.
Panama taxes on a territorial basis: foreign-source income of the foundation is generally outside Panama income tax, while Panama-source income is taxable. Foundations that are part of multinational group structures with foreign passive income should be reviewed under the economic substance rules of Law 526 of 2026.
The design typically balances control and protection: the founder can guide through the council, a protector and the regulations, but keeping too much direct control can weaken both the protection and the tax analysis in your home country. We design the governance for your actual goals.
Confidential consultation in English. We tell you honestly whether a foundation fits your goals — and quote the full cost in writing before you commit.