Post: #1

Capital gains taxes and income taxes are quite high where I live - I want to set up a bank account in the United States (where I travel often) or in a third country where

1. Capital gains are taxed lightly or not at all
2. Costs of maintaining an account are low AND transparent (transparency is vital)
3. Equity, debt, derivative and commodity trading is free or near-free (ie. few or no transaction costs - relates to transparency).

would still have to pay income tax on my salary where I live, but essentially, I would avoid further taxation of it by keeping it elsewhere. I have also been lead to understand that if I am NOT a US resident, I do not have to pay capital gains taxes. Can someone confirm or deny this? I have US citizenship and a US address (registered voter), but not residency seeing how I live abroad.

I would have a credit card or debit card I would use for buying things online or financing travel to enjoy the fruits of these investments. This way, I avoid the danger of the tax authorities here tracking me down. They are VERY stringent and live to bust people like me. I don't believe they would be able to track my accounts once the money had left the country - do US banks EVER provide foreign tax collectors with information pertaining to their clients? For instance, under some of the current anti-terrorist legislation I could imagine they would use that to bust people avoiding taxes.

I am also hoping being a US citizen will remove a lot of the red-tape I could face by opening an account in a place where I'm not a resident. I'm from California, but if there is a BETTER state, I'd look into that.

(I heard New Hampshire is still the live free or die state - some of those praire states are also supposed to be pretty good)

Post: #2

No prob with setting up an account in US whatsoever since of citizenship.

In regards to capital gains tax... well..

Post: #3

(06-19-2011 09:06 AM)Paideia Wrote:  Capital gains taxes and income taxes are quite high where I live - I want to set up a bank account in the United States (where I travel often) or in a third country where

1. Capital gains are taxed lightly or not at all
2. Costs of maintaining an account are low AND transparent (transparency is vital)
3. Equity, debt, derivative and commodity trading is free or near-free (ie. few or no transaction costs - relates to transparency).

would still have to pay income tax on my salary where I live, but essentially, I would avoid further taxation of it by keeping it elsewhere. I have also been lead to understand that if I am NOT a US resident, I do not have to pay capital gains taxes. Can someone confirm or deny this? I have US citizenship and a US address (registered voter), but not residency seeing how I live abroad.

I would have a credit card or debit card I would use for buying things online or financing travel to enjoy the fruits of these investments. This way, I avoid the danger of the tax authorities here tracking me down. They are VERY stringent and live to bust people like me. I don't believe they would be able to track my accounts once the money had left the country - do US banks EVER provide foreign tax collectors with information pertaining to their clients? For instance, under some of the current anti-terrorist legislation I could imagine they would use that to bust people avoiding taxes.

I am also hoping being a US citizen will remove a lot of the red-tape I could face by opening an account in a place where I'm not a resident. I'm from California, but if there is a BETTER state, I'd look into that.

(I heard New Hampshire is still the live free or die state - some of those praire states are also supposed to be pretty good)

I'm not an expert. But I think that you would be essentially doing business in the US so you would be taxed? If you want a bank that doesn't disclose info. you'd have to go to some country like Switzerland (which has disclosed info. to US government)

check out http://www.irs.gov

Post: #4

Re: where to open an account - I have two at TD Ameritrade and at Interactive Brokers. Somewhat different pricing structure, IB is better if you trade more. But you won't find "free" trading anywhere - hey, your broker needs to make money, too.
Both of these are in the names of non-US residents and so don't owe US capital gains tax. However, they want to see a copy of your passport faxed to them, and you have to fill in and sign a W8-BEN form - basically, a declaration of what country you are a citizen of. I believe it would be a major violation to sign it saying you are not a US citizen, if you in fact are one.

Re: capital gains taxes, you still owe them as long you hold your US passport. And the IRS is trying hard to make all foreign banks (not just Swiss) disclose account info - now it's just for high net-worth individuals, but they are trying to make it for all. And if they find you out, the back taxes, penalties, and interest are all retroactive. So think twice.

Post: #5

This is excellent info! Not interested in high-volume trading, probably once a month - my time horizon will be about one month to two years for each individual investment, but generally this to start building up a passive income.

Don't get me wrong - I'm NOT going to do anything illegal - I am, however, willing to exploit loop-holes in taxing legislation, for instance if it was true US citizens abroad didn't have to pay capital gains taxes.

I'm a US citizen living abroad since I was a kid, so actually have never had a US account. New territory.

The weak dollar is what I really want to take advantage of.

Naturally, nothing is free

It sounds like there is no one-stop shop for depositing money (international transfers) and buying equities, debt, etc? I can't, for instance, open an account with Wells Fargo or Bank of America and trade through them?

Thanks for the advice so far, Gents. Appreciate it.

Post: #6

I have an IB account, I'm a mexican citizen and I don't pay taxes neither in the US nor in MX for capital gains. Just broker comissions.