Post: #26

Puss,
No, I don't have a pre-nup. I didn't have money when we got married. So I'm potentially exposed there, but I'm not worried. I'll go to Panama, then set up trust/foundation/corporation stuff (I'll leave that up to experts, I'm clueless on that stuff... just pay them and let them do their thing) in Cook Islands, then initiate a divorce before building a house in Panama. So no assets would be touchable and I'll hook her up fine (car/townhouse/monthly payments).

And Panama is just my first choice. I'm not wedded to it. Plenty of other countries are options if Panama wants to cause hassles or if I can't find a community I like. I like Panama because of the no property tax for 20 years on a newly built house, because it's Americanized a bit, good location with beaches/mountains, and because it has a culture of baseball (training my kids in baseball is big to me).

G,
Yep, Dominica citizenship first. Rent a condo in Panama for 6 months or so to look for a location to build a house and help build up a community. While renting in Panama I renounce US citizenship and after renouncing citizeship, initiate a divorce.

No taxes to Dominica. Panama... you only pay taxes on income generated within Panama. My income is online and based outside of Panama, so no income tax in Panama. But I will probably end up having local food production businesses and with those, yes, I'd pay taxes. I don't care about that... just don't want my online income touched.

Returning to Dominica... I don't know and that's something I've wondered too. But I'm sure it's really lenient. It is a lush and pretty island from what I've seen on internet, but seems like it has a bit of crime. Plus it's in the hurricane belt. The only thing it has going on for it is the economic citizenship program.

I won't live in Panama City. I'm not a city person. I'll need to scout out where I want to set up shop. Ideally I'd like a mountain and a beach home near each other.

So I'll look into Volcan/David/Pedegral area of western Panama by Costa Rican border (southern Costa Rica is becoming a hot spot) or the Coronado/Sora/Anton Valley area 90 minutes outside Panama City.

Post: #27

(10-24-2011 07:56 PM)LostGringo Wrote:  Argentina has been welcoming dodgy types for many years - starting with both the Nazi's and the Jews - unlikely immigrant bedfellows no question, but Juan Peron welcomed anyone with gold, dollars or Swiss Francs. Long a favorite for those who need to disappear.

Yea, that fucking country also has a knack for cutting you off from your own savings when the shit hits the fan. I know it's recovering now,but shit! People couldn't even pull money out to buy bread a few years back. I have been peeping at Paraguay for some time now and believe it or not, Nicaragua.

Post: #28

Nicaragua is a great option to live in for an ex-pat, just not a good option for citizenship/passport. Plus keep the bulk of your money/assets out of it (as with any country you live in). It's on my backup list. Paraguay is the opposite... great for citizenship/passport, sucks to live in.

I'm not speaking from personal experience visiting the countries and living in them... I'm just speaking in terms of typical ex-pat type of lifestyle.

Argentina, yeah, that's on par with USA as far as staying away from because of the horrible politics. But I look forward to visiting Bariloche sometime.

Post: #29

You are married to your Colombian wife. Why didn't you go for that? Have you read the book Emergency? It outlines Neil Strauss's attempt to get a Kit's & Nevis economic citizenship and how it doesn't go as fast as everyone promises. Maybe do several programs in parallel if possible if your dominican citizenship doesn't work out as planned?

Post: #30

ersatz,
Colombia is a horrible citizenship/passport. Plus I don't want to live there. My first son was born in Colombia so he's gonna have a perfecta... renounce USA and Colombia citizenships. This is like free agency... gotta go with the best deals. ha. Pisses me off that it's come to me having to leave the USA, but knowing what I know, it's dumb not to. Millions of other people have left their home countries, so it's nothing new. Just new for Americans.

No, didn't read Emergency... my friend getting the St. Kitts and Nevis citizenship said I wouldn't learn anything from it. Yeah, no doubt when dealing with govt bureaucrats from 2 countries things won't go smoothly, but that's why I'll end up paying $20,000+ to that Nestmann lawyer. Hopefully I can finish up all my ebooks and websites before March so I can start on the citizenship stuff sooner. Don't want to lose focus or have the added stress of doing the citizenship stuff while doing my 1 last burst of work before I can be totally on autopilot.

The 2 fastest citizenship programs are Dominica and St. Kitts and Nevis. Doesn't make sense to do both at same time (plus too expensive) and getting just a passport isn't good enough since I need another citizenship before I can get rid of the American one. Just gotta hope and pray I can get out before Jan 1, 2013 so I can avoid the HIRE Act nonsense and another tax year.

Post: #31

(10-25-2011 12:33 AM)Big Nilla Wrote:  Nicaragua is a great option to live in for an ex-pat, just not a good option for citizenship/passport. Plus keep the bulk of your money/assets out of it (as with any country you live in). It's on my backup list. Paraguay is the opposite... great for citizenship/passport, sucks to live in.

I'm not speaking from personal experience visiting the countries and living in them... I'm just speaking in terms of typical ex-pat type of lifestyle.

Argentina, yeah, that's on par with USA as far as staying away from because of the horrible politics. But I look forward to visiting Bariloche sometime.

You have any word on Paraguay? I spoke to someone who does business in nearby Anguilla, and he told me that the crime in St.kitts, is getting crazy.Not to mention the fucking monkeys overrunning the capital city of Basseterre. Of course, it doesn't matter if you don't plan on living there.

Post: #32

Puss,
PM me your email and I'll email you the February issue of Sovereignman Confidential. It's a monthly 15-20 page newsletter he puts out for like $250 a year. I don't like giving out other peoples' paid things for free since they deserve to be paid, but it'll probably convince you to buy some of his stuff.

That issue talks about what to do and who to contact for Paraguay.

I heard and read the same thing about crime in both Dominica and St. Kitts and Nevis. Not at same level of Jamaica, Haiti, etc, but still not good compared to other Caribbean islands.

Post: #33

Big Nilla -

I would like to take a look at it as well if it doesn't put you out too much.

I have been thinking of signing up for a while.

If that is cool, shoot too: thegmanifesto at yahoo dot com

Post: #34

(10-25-2011 02:30 PM)Pusscrook Wrote:  

(10-25-2011 12:33 AM)Big Nilla Wrote:  Nicaragua is a great option to live in for an ex-pat, just not a good option for citizenship/passport. Plus keep the bulk of your money/assets out of it (as with any country you live in). It's on my backup list. Paraguay is the opposite... great for citizenship/passport, sucks to live in.

I'm not speaking from personal experience visiting the countries and living in them... I'm just speaking in terms of typical ex-pat type of lifestyle.

Argentina, yeah, that's on par with USA as far as staying away from because of the horrible politics. But I look forward to visiting Bariloche sometime.

You have any word on Paraguay? I spoke to someone who does business in nearby Anguilla, and he told me that the crime in St.kitts, is getting crazy.Not to mention the fucking monkeys overrunning the capital city of Basseterre. Of course, it doesn't matter if you don't plan on living there.

I've been in contact with a lawyer in Paraguay in regards to getting citizenship there. Here is what it takes to get citizenship in Paraguay:

Quote:Thank you very much for your e-mail and your interest in my services. It’s always a pleasure for me to help people that are interested in Paraguay to immigrate to my country and to get to know the culture and the way of living.

To get the permanent residency you need the following documents:
-Birth certificate
-Civil state certificate (marriage, divorce, separation, widowhood)
- Certificate of good conduct
- Consular tourist visa for the countries that require it

All documents need to get legalized by the Paraguayan Embassy or
Consulate in your country. Besides that you need to bring 5.000 US$ to proof your economic
Solvency. You need to deposit this amount in Guarani to a chequing or savings account at a Paraguayan bank during the immigration process. You can withdraw itright afterwards. A permanent residency permit allows you an unlimited stay in Paraguay.

You may decide to have your principal or secondary residency in the country,
Find a job or become self-employed. Additionally you may profit of the tax advantages in Paraguay.

All the other required documents needed for the immigration (for example health certificate, Interpol, Paraguayan police certificate etc.) we are going to obtain for you.
We only need 3 or 4 days to finish all the documents for you and present it in front of the migration department.

You do not need to stay more than 3 or 4 days in Paraguay to be able to complete filing the application. We are going to make sure that your documents are processed in the immigration department and can pick up the permanent residency for you after 3 till 4 months.

Since 1983 I have been helping lots of people to immigrate into Paraguay successfully and fast.

The price for every person at this moment is 1.500,-US$. Children from 1 year to 14 year have cost from 700 US$ for every child. That includes a full service package.
We are going to pick you up from the airport, make a reservation for you in a hotel, obtain all documents for you, translate the documents from your home country and legalize everything in the foreign ministry etc. You do not need to worry about anything anymore as soon as you are in Paraguay with the required documents.

The time to obtain the Permanent Residency at this moment is 3 to 4 and after that one week to obtain your Identity Card.

If you have any further questions please do not hesitate to ask. Hope to hear from you soon.

I will say that for anyone who is serious about getting a second citizenship you NEED to become a member of Sovereign Man Confidential. Inside the forum you will find various Boots on the Ground reports from members who have gone or are going through the process of obtaining citizenship in almost every country. If you're serious about Paraguay you will find tons of information in there, including which lawyer is the best, which lawyers to avoid and who to bribe in order to speed up the process. The $350 price for membership is a small price to pay to obtain this kind of information, and it will save you thousands of dollars and hundreds of hours in your quest to obtaining a second citizenship.

Post: #35

Paraguay seems to be an easy come, easy go citizenship. The passports have short expiry dates and your citizenship seems suspect if you haven't lived in Paraguay after several renewals unless you were born in Paraguay.

Post: #36

Not the best example to use, but this article kind of shows why I want to renounce my citizenship, get out from under American laws, and get my assets out of the country. http://autos.yahoo.com/news/feds-pressue...glove.html

Yeah, this guys is the son of a dictator and got the money illegally back in Africa. But that isn't the US govt's problem. That shoud legally be dealt with back in the dictator's country (obviously there wouldn't be justice though), not in the USA by the American govt.

Once the guy brought the money over and used it in the USA, the US govt then has jurisidiction and power over it. And they can decide, for whatever reason, when they want to take it from you.

The US govt does this all the time to innocent Americans. Freezes your assets and you can't even use your own wealth to defend yourself.

Post: #37

(10-25-2011 02:24 PM)Big Nilla Wrote:  ersatz,
Colombia is a horrible citizenship/passport. Plus I don't want to live there. My first son was born in Colombia so he's gonna have a perfecta... renounce USA and Colombia citizenships. This is like free agency... gotta go with the best deals. ha. Pisses me off that it's come to me having to leave the USA, but knowing what I know, it's dumb not to. Millions of other people have left their home countries, so it's nothing new. Just new for Americans.

No, didn't read Emergency... my friend getting the St. Kitts and Nevis citizenship said I wouldn't learn anything from it. Yeah, no doubt when dealing with govt bureaucrats from 2 countries things won't go smoothly, but that's why I'll end up paying $20,000+ to that Nestmann lawyer. Hopefully I can finish up all my ebooks and websites before March so I can start on the citizenship stuff sooner. Don't want to lose focus or have the added stress of doing the citizenship stuff while doing my 1 last burst of work before I can be totally on autopilot.

The 2 fastest citizenship programs are Dominica and St. Kitts and Nevis. Doesn't make sense to do both at same time (plus too expensive) and getting just a passport isn't good enough since I need another citizenship before I can get rid of the American one. Just gotta hope and pray I can get out before Jan 1, 2013 so I can avoid the HIRE Act nonsense and another tax year.

That makes sense that you'd want it asap. It seems like taxes will cost more for you than this citizenship. I just thought since you basically needed any passport, that your marriage to a colombian would provide that for you and you wouldn't have to pay $100k. I looked more into it and I can see you want to avoid having to live/wait for 2 years in Colombia and avoid military service for your sons and possibly for yourself. Visa wise, Dominica isn't that much better than Colombia.

All governments have shit that stinks and asset forfeiture is spreading around.

The only thing I don't like about american citizenship is that it's the only country in the world that still requires you to pay income taxes even if you don't live or work in the country for years and it doesn't look like it's going to change any time soon. You can't walk away unless you give it up completely, after 6-10 years of possible bullshit acquiring it. Otherwise I would of started applying months ago.

Post: #38

I am going to go against the grain a bit here Big Nilla. I don't think ex-patriating is a wise choice.

First, what do you possibly gain?

Lower taxes. That's about it. Well, you don't have to expatriate to achieve that. None of the preeminent expats I listen to advocate it either - guys like Jim Rogers or Doug Casey come to mind. Forget about dedication to principle here. It's all about options. In principle I am against socialism, welfare, warfare, and the concept of taxes taken by force for bureaucrats and politicians to reallocate. Yet, unfortunately, this situation exists everywhere in the world to one degree or another. I can assure you that you will find a laundry list of things that annoy you politically in any country to which you relocate. Welcome to Earth. So why remove the option of your United States passport? It isn't the same world like it was when half my family emigrated from Lithuania in the early 20th century; with jet travel and Internet access it is now a global world so to speak.

In the spirit of keeping maximum options on the table, a United States passport is very valuable.

So, how do you go about achieving lower taxes and political diversification? Political diversification is easy with the Dominican economic citizenship route. So do it, and now you are politically diversified and can leave the United States with your family anytime you want if things get bad. As for lower taxes, there are quite a few options. If you no longer desire to live in the United States, you open a bank account and mailing address in a state with no state income tax. They are Alaska, New Hampshire, Tennessee, Florida, South Dakota, Washington, Nevada, Texas, and Wyoming. You have eliminated personal state income tax.

Now it's time to eliminate Federal income tax. If you have residency abroad and remain there for six months of the year, or if you are outside the country for the entire year, and you are subject to another tax jurisdiction, then you qualify for an annual $91,400 federal tax exemption - adjusted for inflation from 2009 (I believe it is over $96,000 now). If you are married, that amount doubles. Panama does not tax world wide income either if memory serves correct, so as long as your income is derived outside of Panama and the United States you can effectively pay yourself almost $200,000 in personal income, tax free.

Since I presume your business is online, make sure that it is incorporated as an IBC (International Business Corporation) in a tax friendly jurisdiction. You could do the Caymans, BVI, Bahamas, Belize, or whatever you choose. Personal shares for that corporation are held in a Cook Island trust, which has a two year statue of limitations against the trust. In other words if someone wanted to sue you, say in America or Panama, they would have to initiate legal actions in that jurisdiction. If for some reason they won that suit, they would then have to fly to the Cook Islands and attempt legal action against the trust. The whole process, from beginning to end, must be under two years - which isn't going to happen. I have heard that the Cook Islands even denied the federal government of the United States in a suit against a trust. Sounds like nice protection to me.

So your income flows into the IBC tax free. You can pay yourself personally up to $200,000 tax free. The only requirement is that any foreign bank account exceeding $10,000 must be reported to the IRS - including a CFC (Controlled Foreign Corporation) - which what the IRS considers your IBC. There are harsh penalties for failing to report, but that's it. There is zero action otherwise. Essentially you'd be paying no tax, and anything you wanted to spend over $200,000 would be a corporate expense and tax free - so long as you don't repatriate the money. Excess capital could be put into other IBC's and trusts in different jurisdictions if so desired.

Hell, if you wanted, I am sure it's a grey area, but you could undergo a name change in Dominica and open foreign accounts with a different identity. Shady, yes. Effective, probably.

In any case, you have kept all your options on the table by keeping your U.S. passport. Besides if you need to leave, do you really want to be in Dominica? If your children want access to capital, there are vast pools in the United States. Also consider that a Dominica passport does not get you visa free travel to the United States. Do you really want to apply for a U.S. visa every time you want to come home?

Finally, two other points to consider:

First, I don't consider a Panamanian Foundation, based upon the Liechtenstein Foundation, to be good protection. I am sure that you have heard of it, but the IRS simply does not recognize it - it will either be considered a corporation or a trust. I would stay away from it.

Second, is the Coriolis effect. Aside from deep ocean currents like the Gulf Stream, wind and ocean currents stay in their respective hemispheres. 90% of the world's population, and 95% of the worlds pollution are in the northern hemisphere. You want clean water, fish, rain? Go south! Imagine all of the nuclear plants, literally over one thousand, are almost exclusively in the northern hemisphere. Almost all wars are in the northern hemisphere. Nuclear radiation, from meltdowns or war will predominantly stay in the north - along with all of the industrial pollution. To be in the southern hemisphere, forget Costa Rica, Panama, Colombia (sorry guys) - it's Ecuador south. Your viable options are basically Ecuador, Chile, Brazil, Argentina, Paraguay, and Uruguay. If you don't like earthquakes, stay away from Chile and Ecuador to build property. So you now have the Mercosur countries with easy travel between them. I call it the golden triangle, southern Brazil, Uruguay, Argentina - there's no hurricane's, earthquakes, tornados and it's mostly European descendants, it has good weather, world class beaches and a nice climate.

If it were me, I'd have state residency in Florida and choose Uruguay for my permanent residency. Uruguay also doesn't tax worldwide income. It is stable, allegedly more safe than Argentina and Brazil, and has easy access to permanent residency. Just open a bank account and stay in Punta Del Este for at least 6 months per year until you get your residency. Then you'd have United States citizenship, Dominican citizenship, and permanent residency in Uruguay (and essentially permanent access to all of north and south America). You'd also pay almost zero taxes. In fact, that is my plan.

Post: #39

Of course I would, if the incentives were right.

A citizenship is a scrap of paper. I would still be an American with or without my US citizenship.

Just like plenty of holders of US passports aren't American at all.

Post: #40

Quote:so as long as your income is derived outside of Panama and the United States you can effectively pay yourself almost $200,000 in personal income, tax free.

So you income can't be derived from The US?

If it is, you are taxed?

Post: #41

(01-24-2012 05:50 PM)Thorfinnsson Wrote:  Of course I would, if the incentives were right.

A citizenship is a scrap of paper. I would still be an American with or without my US citizenship.

Just like plenty of holders of US passports aren't American at all.

Agreed.

Post: #42

That is correct G. Don't take everything I say as gospel, but I have spent a lot of time looking into this setup. My understanding is that the United States taxes domestic income no matter what, no matter where, or who you are. Most foreign countries don't tax world wide income (unlike the U.S.). So the objective is to have a foreign IBC (e.g. in Cayman Islands) earning income outside the United States, and have permanent residency at least six months of the year in a country like Uruguay that does not tax foreign income. If you are subject to Uruguayan taxes, you as a single man you get a $96,000 federal tax credit so your first $96,000 is tax free according to the IRS. If you are a permanent resident of Florida G, and I know you like Miami, then you pay no state income taxes either. If you don't like Uruguay, then pick a country you like - preferably a Mercosur country. My understanding is Paraguay and Uruguay are easy for permanent residency, but Argentina and Brazil are more difficult. You'll have to spend six months of the year there. Alternatively, if you don't want to spend six months of the year in one country I believe you have to spend 351+ days outside of the United States in general to qualify for the tax credit - I forget the number but you get less than 2 weeks per year to be in the U.S. and still get that credit.

Another thing to note, your IBC can still generate revenue in the U.S. you just have to pay tax on it. So if you have a website, of course you would want the extra revenue from the U.S. - it would just be taxable. All other monies are not taxable unless you repatriate them.

I know Doug Casey chose Uruguay, and he lives in Argentina. I am not sure how he manages that. At least during the period to gain your permanent residency you'd be stuck in Uruguay for a minimum of 183 days per year, but you could take weekend flights or ferries into B.A. and short flights into Cordoba, Florianopolis, Sao Paolo, Porte Alegre, etc. Just time it during peak season and kick it on the beach at Punta Del Este.

Post: #43

(01-24-2012 05:10 PM)durangotang Wrote:  I am going to go against the grain a bit here Big Nilla. I don't think ex-patriating is a wise choice.

First, what do you possibly gain?

Lower taxes. That's about it. Well, you don't have to expatriate to achieve that. None of the preeminent expats I listen to advocate it either - guys like Jim Rogers or Doug Casey come to mind. Forget about dedication to principle here. It's all about options. In principle I am against socialism, welfare, warfare, and the concept of taxes taken by force for bureaucrats and politicians to reallocate. Yet, unfortunately, this situation exists everywhere in the world to one degree or another. I can assure you that you will find a laundry list of things that annoy you politically in any country to which you relocate. Welcome to Earth. So why remove the option of your United States passport? It isn't the same world like it was when half my family emigrated from Lithuania in the early 20th century; with jet travel and Internet access it is now a global world so to speak.

In the spirit of keeping maximum options on the table, a United States passport is very valuable.

So, how do you go about achieving lower taxes and political diversification? Political diversification is easy with the Dominican economic citizenship route. So do it, and now you are politically diversified and can leave the United States with your family anytime you want if things get bad. As for lower taxes, there are quite a few options. If you no longer desire to live in the United States, you open a bank account and mailing address in a state with no state income tax. They are Alaska, New Hampshire, Tennessee, Florida, South Dakota, Washington, Nevada, Texas, and Wyoming. You have eliminated personal state income tax.

Now it's time to eliminate Federal income tax. If you have residency abroad and remain there for six months of the year, or if you are outside the country for the entire year, and you are subject to another tax jurisdiction, then you qualify for an annual $91,400 federal tax exemption - adjusted for inflation from 2009 (I believe it is over $96,000 now). If you are married, that amount doubles. Panama does not tax world wide income either if memory serves correct, so as long as your income is derived outside of Panama and the United States you can effectively pay yourself almost $200,000 in personal income, tax free.

Since I presume your business is online, make sure that it is incorporated as an IBC (International Business Corporation) in a tax friendly jurisdiction. You could do the Caymans, BVI, Bahamas, Belize, or whatever you choose. Personal shares for that corporation are held in a Cook Island trust, which has a two year statue of limitations against the trust. In other words if someone wanted to sue you, say in America or Panama, they would have to initiate legal actions in that jurisdiction. If for some reason they won that suit, they would then have to fly to the Cook Islands and attempt legal action against the trust. The whole process, from beginning to end, must be under two years - which isn't going to happen. I have heard that the Cook Islands even denied the federal government of the United States in a suit against a trust. Sounds like nice protection to me.

So your income flows into the IBC tax free. You can pay yourself personally up to $200,000 tax free. The only requirement is that any foreign bank account exceeding $10,000 must be reported to the IRS - including a CFC (Controlled Foreign Corporation) - which what the IRS considers your IBC. There are harsh penalties for failing to report, but that's it. There is zero action otherwise. Essentially you'd be paying no tax, and anything you wanted to spend over $200,000 would be a corporate expense and tax free - so long as you don't repatriate the money. Excess capital could be put into other IBC's and trusts in different jurisdictions if so desired.

Hell, if you wanted, I am sure it's a grey area, but you could undergo a name change in Dominica and open foreign accounts with a different identity. Shady, yes. Effective, probably.

In any case, you have kept all your options on the table by keeping your U.S. passport. Besides if you need to leave, do you really want to be in Dominica? If your children want access to capital, there are vast pools in the United States. Also consider that a Dominica passport does not get you visa free travel to the United States. Do you really want to apply for a U.S. visa every time you want to come home?

Finally, two other points to consider:

First, I don't consider a Panamanian Foundation, based upon the Liechtenstein Foundation, to be good protection. I am sure that you have heard of it, but the IRS simply does not recognize it - it will either be considered a corporation or a trust. I would stay away from it.

Second, is the Coriolis effect. Aside from deep ocean currents like the Gulf Stream, wind and ocean currents stay in their respective hemispheres. 90% of the world's population, and 95% of the worlds pollution are in the northern hemisphere. You want clean water, fish, rain? Go south! Imagine all of the nuclear plants, literally over one thousand, are almost exclusively in the northern hemisphere. Almost all wars are in the northern hemisphere. Nuclear radiation, from meltdowns or war will predominantly stay in the north - along with all of the industrial pollution. To be in the southern hemisphere, forget Costa Rica, Panama, Colombia (sorry guys) - it's Ecuador south. Your viable options are basically Ecuador, Chile, Brazil, Argentina, Paraguay, and Uruguay. If you don't like earthquakes, stay away from Chile and Ecuador to build property. So you now have the Mercosur countries with easy travel between them. I call it the golden triangle, southern Brazil, Uruguay, Argentina - there's no hurricane's, earthquakes, tornados and it's mostly European descendants, it has good weather, world class beaches and a nice climate.

If it were me, I'd have state residency in Florida and choose Uruguay for my permanent residency. Uruguay also doesn't tax worldwide income. It is stable, allegedly more safe than Argentina and Brazil, and has easy access to permanent residency. Just open a bank account and stay in Punta Del Este for at least 6 months per year until you get your residency. Then you'd have United States citizenship, Dominican citizenship, and permanent residency in Uruguay (and essentially permanent access to all of north and south America). You'd also pay almost zero taxes. In fact, that is my plan.

It was my understanding that the AMT would kick in if you were resident in a no tax or low tax jurisdiction. This would prevent you from having a $200K tax free income even if all your income was derived from abroad and you were resident outside the US.

Post: #44

[/quote]
It was my understanding that the AMT would kick in if you were resident in a no tax or low tax jurisdiction. This would prevent you from having a $200K tax free income even if all your income was derived from abroad and you were resident outside the US.
[/quote]

Let me be clear, I am no tax expert. I have read up on the matter and this is my understanding. If anyone can further enlighten us about AMT, I would appreciate it - so many fucking laws it's hard to keep track short of hiring an expert which I am not prepared to do now.

Here is an excerpt that I found regarding AMT:

http://www.escapeartist.com/transatlantic/magazine3.htm

"Most US citizens are able to avoid paying US taxes on their foreign earned income as a result of two provision in US income tax law. Foreign Earned Income Exclusion ($72,000 in 1998) and foreign tax credit. Under the foreign earned income exclusion qualified individuals report all of their wages, salaries and other earned income, but are able to exclude up to $72,000 of their foreign earnings in computing their adjusted gross income. If after claiming the exclusion, individuals still have foreign sourced income which is subject to tax in both the US and their foreign country, foreign tax credits (foreign taxes paid) can generally be used to offset that part of the US income tax liability which relates to the foreign-sourced income. If the foreign-sourced income, after exclusion, is large, individuals must be aware of the potential that Alternative Minimum Tax may apply. Individuals with high incomes may owe US income tax because of the AMT."

And the IRS link:

http://apps.irs.gov/app/amt2011/StartApplication.do

Post: #45

(01-24-2012 06:11 PM)thegmanifesto Wrote:  

Quote:so as long as your income is derived outside of Panama and the United States you can effectively pay yourself almost $200,000 in personal income, tax free.

So you income can't be derived from The US?

If it is, you are taxed?

The income can be derived from the US, and you'd still be able to use the Foreign Earned Income Exclusion.

Look at IRS Publication 54 (look for "Foreign Earned Income and Housing: Exclusion – Deduction" - "Requirements" - "Foreign Earned Income" - "Source of Earned Income"), where it says, "The source of your earned income is the place where you perform the services for which you received the income. Foreign earned income is income you receive for working in a foreign country. Where or how you are paid has no effect on the source of the income. For example, income you receive for work done in Austria is income from a foreign source even if the income is paid directly to your bank account in the United States and your employer is located in New York City."

If you're being paid by a US company, you'd still need to pay FICA.

You could eliminate the FICA payment if you are being paid by a non-US corporation. However, if want to set up your own non-US company, it involves some more paperwork, expenses, and headaches. The breakeven point, where the expenses are around equal to what you'd save from FICA is when your income reaches around US$ 30-40,000.

This is what I'm doing, based on the advice of my CPA who does a lot of work for expats.

Of course, like all tax and legal advice you get from the Internet, be sure to verify all this with your own accountant.

Post: #46

[/quote]
The income can be derived from the US, and you'd still be able to use the Foreign Earned Income Exclusion.
[/quote]

That may be true on a personal level, but consider the circumstance I am plotting. I incorporate a business (IBC) in the Caymans. It is exempt from income tax, capital gains tax, etc. I pay myself a salary from said corporation to myself in Uruguay. I am earning that salary, as a resident of Uruguay and applicable to Uruguayan tax code which does not tax an individual on world wide income from my IBC in the Caymans, so my Foreign Earned Income Exclusion of $96,000 applies.

Now, say my corporation is a website that derives income from around the world. Income for foreign corporations is taxable by the U.S. for income derived from the U.S. - not world wide income as far as I understand. Hopefully my corporate income is much higher than what I pay myself personally - which is in effect tax free as long as it is never repatriated.

So I think the difference lies in whether or not you are a foreign corporation or an individual. Great information though, I appreciate it. Good luck and keep us posted on your tax progress!

Post: #47

(01-24-2012 08:22 PM)durangotang Wrote:  That may be true on a personal level, but consider the circumstance I am plotting.

To get around the problem you are talking about, my US corporation is a pass-through LLC. So, all profits from the company are treated as personal income (which the FEIE covers), and not corporate profits.

If you expect to be earning more than the FEIE limits (along with the roughly $13,000 exemption you can take for living expenses overseas and your standard $5,800 personal deduction), then it is definitely worth incorporating overseas.

BTW, have you been following the latest changes for Uruguayan permanent residency? Expect the process to take 12-18 months. A while back, they started to check to make sure you were actually living there full-time, and I've heard (but haven't confirmed) you may now need to produce an official police residence certificate, which you can only get with a utility bill in your name at an address in Uruguay.

Post: #48

durangotang Wrote:Hell, if you wanted, I am sure it's a grey area, but you could undergo a name change in Dominica and open foreign accounts with a different identity. Shady, yes. Effective, probably.

Hey Durango, great post!

I'm very curious about this. You see, for some odd reason (I will not post details on a public forum), I have dual nationality with another country, and am working on getting my passport now. However, because of my ancestors, my LEGAL NAME in that country is completely different than my US Citizen legal name. Yeah, very complicated.

So, I was hiring a lawyer in that foreign country to change my legal name in Dominica for example, to match my USA legal name. However, I've heard from several trusted friends that I should just take-out this foreign passport on my legal name in that country.

So, in you opinion, is that a benefit and an advantage I would have? Would I get in "trouble" as a US Citizen for holding a 2nd passport under a completely different name in a foreign country - albeit, it is my LEGAL name in that country?

Mixx

Post: #49

(01-24-2012 05:10 PM)durangotang Wrote:  I am going to go against the grain a bit here Big Nilla. I don't think ex-patriating is a wise choice.

First, what do you possibly gain?

Lower taxes. That's about it. Well, you don't have to expatriate to achieve that. None of the preeminent expats I listen to advocate it either - guys like Jim Rogers or Doug Casey come to mind. Forget about dedication to principle here. It's all about options. In principle I am against socialism, welfare, warfare, and the concept of taxes taken by force for bureaucrats and politicians to reallocate. Yet, unfortunately, this situation exists everywhere in the world to one degree or another. I can assure you that you will find a laundry list of things that annoy you politically in any country to which you relocate. Welcome to Earth. So why remove the option of your United States passport? It isn't the same world like it was when half my family emigrated from Lithuania in the early 20th century; with jet travel and Internet access it is now a global world so to speak.

In the spirit of keeping maximum options on the table, a United States passport is very valuable.

So, how do you go about achieving lower taxes and political diversification? Political diversification is easy with the Dominican economic citizenship route. So do it, and now you are politically diversified and can leave the United States with your family anytime you want if things get bad. As for lower taxes, there are quite a few options. If you no longer desire to live in the United States, you open a bank account and mailing address in a state with no state income tax. They are Alaska, New Hampshire, Tennessee, Florida, South Dakota, Washington, Nevada, Texas, and Wyoming. You have eliminated personal state income tax.

Now it's time to eliminate Federal income tax. If you have residency abroad and remain there for six months of the year, or if you are outside the country for the entire year, and you are subject to another tax jurisdiction, then you qualify for an annual $91,400 federal tax exemption - adjusted for inflation from 2009 (I believe it is over $96,000 now). If you are married, that amount doubles. Panama does not tax world wide income either if memory serves correct, so as long as your income is derived outside of Panama and the United States you can effectively pay yourself almost $200,000 in personal income, tax free.

Since I presume your business is online, make sure that it is incorporated as an IBC (International Business Corporation) in a tax friendly jurisdiction. You could do the Caymans, BVI, Bahamas, Belize, or whatever you choose. Personal shares for that corporation are held in a Cook Island trust, which has a two year statue of limitations against the trust. In other words if someone wanted to sue you, say in America or Panama, they would have to initiate legal actions in that jurisdiction. If for some reason they won that suit, they would then have to fly to the Cook Islands and attempt legal action against the trust. The whole process, from beginning to end, must be under two years - which isn't going to happen. I have heard that the Cook Islands even denied the federal government of the United States in a suit against a trust. Sounds like nice protection to me.

So your income flows into the IBC tax free. You can pay yourself personally up to $200,000 tax free. The only requirement is that any foreign bank account exceeding $10,000 must be reported to the IRS - including a CFC (Controlled Foreign Corporation) - which what the IRS considers your IBC. There are harsh penalties for failing to report, but that's it. There is zero action otherwise. Essentially you'd be paying no tax, and anything you wanted to spend over $200,000 would be a corporate expense and tax free - so long as you don't repatriate the money. Excess capital could be put into other IBC's and trusts in different jurisdictions if so desired.

Hell, if you wanted, I am sure it's a grey area, but you could undergo a name change in Dominica and open foreign accounts with a different identity. Shady, yes. Effective, probably.

In any case, you have kept all your options on the table by keeping your U.S. passport. Besides if you need to leave, do you really want to be in Dominica? If your children want access to capital, there are vast pools in the United States. Also consider that a Dominica passport does not get you visa free travel to the United States. Do you really want to apply for a U.S. visa every time you want to come home?

Finally, two other points to consider:

First, I don't consider a Panamanian Foundation, based upon the Liechtenstein Foundation, to be good protection. I am sure that you have heard of it, but the IRS simply does not recognize it - it will either be considered a corporation or a trust. I would stay away from it.

Second, is the Coriolis effect. Aside from deep ocean currents like the Gulf Stream, wind and ocean currents stay in their respective hemispheres. 90% of the world's population, and 95% of the worlds pollution are in the northern hemisphere. You want clean water, fish, rain? Go south! Imagine all of the nuclear plants, literally over one thousand, are almost exclusively in the northern hemisphere. Almost all wars are in the northern hemisphere. Nuclear radiation, from meltdowns or war will predominantly stay in the north - along with all of the industrial pollution. To be in the southern hemisphere, forget Costa Rica, Panama, Colombia (sorry guys) - it's Ecuador south. Your viable options are basically Ecuador, Chile, Brazil, Argentina, Paraguay, and Uruguay. If you don't like earthquakes, stay away from Chile and Ecuador to build property. So you now have the Mercosur countries with easy travel between them. I call it the golden triangle, southern Brazil, Uruguay, Argentina - there's no hurricane's, earthquakes, tornados and it's mostly European descendants, it has good weather, world class beaches and a nice climate.

If it were me, I'd have state residency in Florida and choose Uruguay for my permanent residency. Uruguay also doesn't tax worldwide income. It is stable, allegedly more safe than Argentina and Brazil, and has easy access to permanent residency. Just open a bank account and stay in Punta Del Este for at least 6 months per year until you get your residency. Then you'd have United States citizenship, Dominican citizenship, and permanent residency in Uruguay (and essentially permanent access to all of north and south America). You'd also pay almost zero taxes. In fact, that is my plan.

Durango, glad you bumped this up. Good info. More people need to be exposed to this stuff. But I'm still going the non-American route.

If I fell into the parameters you mentioned, then yes, sticking with being an American and living overseas would be an option. Each person has a unique situation. For me, it's best not to be an American any longer.

I'm not wedded to living in Costa Rica, Panama, or anywhere. Just wedded to the idea of being a non-American. From there, I can hop around countries until I find a good fit. And with the money I'm making, I could easily own/rent nice homes in 2+ countries. Add in the not paying American taxes along with lower cost of living in the countries I'd live in and I'm effectively doubling my income and quadrupling my standard of living... and can still visit the USA for 4 months a year IF I wanted to.

Actually wrote an email to Simon of sovereignman.com last night about Dominican economic citizenship. I'm a little worried the process will take longer than I thought and I wouldn't be able to renounce before the 2013 tax year. So I asked him if it's possible to jump to getting a quicker passport, say in Paraguay, and then renounce American citizenship with only a Paraguayan passport, not citizenship.

Then need to know if applying for Dominican citizenship with just a passport and no citizenship anywhere would be a problem.

Post: #50

(01-25-2012 11:15 AM)MiXX Wrote:  

durangotang Wrote:Hell, if you wanted, I am sure it's a grey area, but you could undergo a name change in Dominica and open foreign accounts with a different identity. Shady, yes. Effective, probably.

Hey Durango, great post!

I'm very curious about this. You see, for some odd reason (I will not post details on a public forum), I have dual nationality with another country, and am working on getting my passport now. However, because of my ancestors, my LEGAL NAME in that country is completely different than my US Citizen legal name. Yeah, very complicated.

So, I was hiring a lawyer in that foreign country to change my legal name in Dominica for example, to match my USA legal name. However, I've heard from several trusted friends that I should just take-out this foreign passport on my legal name in that country.

So, in you opinion, is that a benefit and an advantage I would have? Would I get in "trouble" as a US Citizen for holding a 2nd passport under a completely different name in a foreign country - albeit, it is my LEGAL name in that country?

Mixx

Senior Mixx,

This whole thing is well beyond my expertise and hypothetical. There are two things to consider: tax avoidance (legal) and tax evasion (illegal). Tax avoidance is using all legal means to reduce your taxes and is the goal, tax evasion is illegal and uses illegal means to not pay taxes which I cannot advocate.

If we were to hypothetically speculate on evasion - I think you are quite lucky. I am pretty sure the term used in one of the books I read was "signature authority," I'd have to go back and check and again I am no expert, but you are required to report any account overseas in excess of $10,000 in which you have signature authority. So, I would assume the IRS doesn't care what other name or corporation you are using as a vehicle - if you have signature authority they want you to declare. Now, I don't know what would happen if you were investigated, but I assume the IRS would look for all accounts under your legal name or known aliases. If the investigation in a foreign country checked for legal name changes or aliases you would be lucky that none appeared since you didn't have that done. You simply have always had a different name.

Perhaps your other alias, your different name, would appear with a fingerprint check in some international database and you would be fucked. Who knows, it's all speculation. The premise is the less they know about your other identity the better if you are evading taxation. You would be well advised to get good legal counsel before you do anything, because chances are I am probably wrong. Personally, I plan to go the tax avoidance (legal) route.

All the same, it's still cool.