Instead of whining about bailouts, tax dollars and politicians, you can live large in several Caribbean or European nations and pay little to nil (capital gains) taxes derived from trading -- as long as you're willing to surrender your American citizenship, accept snobbish aristocrat neighbors and probably the need to learn a new language or two. 1. Since the US sources taxes on global income - no matter where you live - you have to relinquish your US passport. 2. Therefore you need to acquire citizenship from some random country whose tax regime does not levy taxes on global income regardless of where you live, but only taxes you if you reside in your then (new) home country - which you won't. This is key. See http://www.henleyglobal.com/citizenship/countries/ - Singapore looks like it might qualify. Didn't Jim Rogers relocate there? Canadian citizenship could be another idea worth researching. 3. Once a happy new citizen of a new country, you migrate to yet another country using the non-US passport you acquired during step #2, this time you pick it by quality of life and attractiveness of the foreign residents tax regime. Some ideas would be Andorra, Monaco or Switzerland. Switzerland offers a lump sum taxation regime that enables foreigners who don't work nor do business locally in Switzerland to pay only minimal taxes (Michael Schumacher, Tina Turner, Charlie Chaplin etc. are some notable examples) Interesting introductory article http://www.forbes.com/2007/07/30/retirement-europe-tax-pf-taxes-in_sf_0725taxes_inl.html Potential pitfall: "If you are renouncing citizenship to avoid being taxed, you still have to pay tax for 10 years". See http://answers.google.com/answers/threadview/id/759866.html . One will probably need a credible "excuse" for relinquishing one's US passport. Don't like the idea of yourself and your children paying the trillion Dollar/Euro tax bills over the next 50 years? This is a cumbersome process but if you have enough assets on the line it can well pay off if you add up decades worth of taxes. Disclaimer: Do your own research, talk to lawyers and accountants with extensive foreign/offshore expertise.
This idea is already in my arsenal of preparations. I hope I will not have to implement the plans, but it is becoming more plausable as the dreadful days pass of the guidance from our inept government.
Excellent post. I've been pondering this lately. Tom Keene at Bloomberg On the Economy has two guests on from Zurich this week. It has potential but I would hate to leave my aging parents.
Btw, that henleyglobal link doesn't tell you shit about those countries. Their picture-book descriptions are totally off.
Its a great idea that i bet many have pondered. About giving up US citizenship , even if u have a 'good' reason, non tax related, if u have a good amount of assets the IRS will probably be sniffing up your ass for many years. Its just seems like a big headache especially when its comes to the IRS (big fear factor there). Most USA citizens also have attachments to the country like family n friends and just dont want it to be a hassle to return to the country. I heard having a 2nd identity works nicely and with less hassle as u still have your 1st identity to travel with.
Keep in mind the 'exit tax' that slimeball Rangel pushed through last year attached to some veterans bill. If you want to leave the US, you will still be on the hook for 10 years of taxes or they could take 50% of your global assets as the door hits you on the way out. This all assumes you paid something like a total of $100k in taxes the previous 5 years -burn8
This should be renamed the "cut and run" thread. I'm born American, proud to be American, and will die an American. If America has to raise my taxes in order to remain solvent, strong and free, then I will do my duty and pay them. Patriotism isn't just saluting the flag, it's also pitching in helping your country when she needs help.
Canada has a world-wide income clause, and a 50% capital gains tax. If you make $100,000, you pay tax on $50,000 at whatever your marginal tax rate is. Ie. 35%.