I believe this is the best options. If I remember well, lots of high-profile athletes took up residence in Monaco. Unfortunately, the cost of real estate there is (or used to be) downright outrageous.
Switzerland - a welcoming homeland for "tax refugees" By Marie-Noelle Blessig Michael Schumacher benefits from the Swiss system ZURICH (AFP) - There is a certain type of foreigner who flees to Switzerland and is welcomed with open arms -- the "tax refugee," who sets up home in Switzerland in a bid to escape high tax demands in his or her native land. Tax refugees have nothing to do with asylum-seekers and are believed to number about 2,500, according to a recent study. About 1,000 of them are concentrated in one canton (region), the western French-speaking region of Vaud, whose main city is Lausanne, the study by the Zurich-based group Tax Expert International said. As an unwritten rule, belonging to this club requires having a personal fortune of at least five million Swiss francs (3.4 million euros, dollars) and a comfortable annual income, the group said. "Foreigners, and especially the Swedes and Finnish, like the region of Geneva Lake a lot because it reminds them of the serenity of their fjords," said an author of an article on the 300 richest people in Switzerland, published this month in the Swiss magazine Bilan. The regions of Geneva, and Ticino in the Italian-speaking south, each have attracted about 500 hefty foreign fortunes and the rest are split between the regions of Bern -- especially the chic ski resort of Gstaad -- Schwyz, Graubunden, Zurich, Luzern and Zug, in central and eastern parts of the country. Switzerland reserves a special status for these rich foreigners in granting them a fiscal package. The offer is exclusive to them and not open to Swiss citizens. They negotiate an arrangement with the Swiss tax authorities allowing them to be taxed on their life style rather than on their real fortune. German Formula One racing driver Michael Schumacher benefits from such a system. Although his annual income is about 100 million Swiss francs (66 million euros), he only pays two million Swiss francs in taxes, or scarcely two percent annually. Under Switzerland's decentralised tax system, regional tax authorities have the power to raise or lower taxes, leading to a certain amount of competition between the cantons to attract these 'refugees'. Foreign tax refugees make up a good third of the latest listing of the 300 richest people in Switzerland, all of whom have at least 100 million Swiss francs, deputy chief editor of Bilan, Olivier Toublan, said. In the first two top positions are two Swedes, Ingwar Kamprad (15 billion Swiss francs) who heads the Swedish furniture giant Ikea, and the Rausing family (14 billion Swiss francs), owners of the Tetra Laval group, which invented cartons for milk and fruit juices. Numerous French nationals have hopped across the border to live in the canton of Geneva, including Francois Dalle, former head of the French cosmetics giant L'Oreal, and Roger Zannier who specialises in children's clothing. To set up home in Switzerland these tax refugees call on specialist lawyers or on banks who offer their services in the hope of gaining the private banking business of these expatriates in exchange. The Micheloud lawyer's practice in Lausanne for example displays on its internet site statements by clients expressing their delight at their new life in Switzerland. One wealthy woman from Dijon had just one thing she regretted, having built her chalet in the eastern Swiss region of Graubunden -- that she had not come to Switzerland soo http://www.caymannetnews.com/Archiv...ember 2002/Issue 301 Wed/Switzerland - A.html
Michael Schumacher even plays in the local football team, the FC Echichens. It's 3 villages away from my home. Very funny to see him. Noone really risks himself trying to hurt him...
For US citizens, why not just trade tax-free in a Roth IRA? Ther are any number of trust companies that will hold the IRA and let you open a self-directed (margin) futures/stock account at a plethora of brokers. No need for shady tax dealings, living on a boat, nor sleepless nights. So simple and legal, that not even an accountant is needed. Restrictions are that your earned income in the year you wish to contribute to a Roth IRA must not exceed $150K if married or $95K if single, and the most you can contribute is $4,000. Just take that $4K and with some trading skill(!), run it up into millions in full view of Uncle Sam and never have to pay a dime in tax. Well OK, so you may want to make early withdrawals to "live off". Go talk to an accountant about 'equal periodic payments' or have a separate trading account that you do pay tax on, just enough money to live off, while you focus on building up the Roth IRA account. If the Roth IRA early withdrawal rules are too restrictive or you make too much money to be able to contribute, just sit tight for a year and see if Bush can get Congress to approve his proposal for a new "Lifetime Savings Account" (LSA). See page 9 on the proposal link below. What a result for traders if that passes. You could contribute the $5K per year regardless of income level ($10K per year if your spouse rolls his/her LSA into yours), money grows tax-free forever, no tax when withdrawn, can withdraw cash for any reason at any time. How much better than that could it get? If LSAs come into law, thank you goodnight! Here is the proposal: http://www.treas.gov/offices/tax-policy/library/bluebk05.pdf
I believe that you can have a futures IRA with IB, yes. But it's not the brokers who charge anything for trading in an IRA, it's the trust companies. IB were a bit slow to offer futures IRAs and I don't know what restrictions/costs their trust company has. I once heard that they wouldn't allow a margin account but don't know if that is true. Commissions at the broker are the same with an IRA account as with a normal account. Fees at the Trust Company are usually nominal - it's a competitive market. One of the most popular trust companies for futures IRAs is Millennium: http://www.mtrustcompany.com/ira.html#Futures Another is: http://www.northstartrust.com/ NorthStar just hold back a bit more money as cash than Millenium. Let's say you have a $10,000 IRA with NorthStar, maybe they hold $2,000 in a money market fund and only allow you to send $8,000 to the futures broker. The trust company will tell you what formula they use. I think Millenium pretty much allows you to send nearly all the money over. There's no ongoing or trading fees for either trust company. Commissions with the actual futures broker are whatever they adverstise or you negotiate. If you only want IB as your broker, then check out their trust company and see what rules and fees they/IB have. If they are too restrictive then get a new broker if this is important to you! e.g. contact Millenium or NorthStar and ask for their "list of clearing firms" that they have a relationship with. Then pick a broker from that list after negotiating the commission with the broker directly. You open the IRA account (cash or rollover) with the Trust Company first, then they/you open the brokerage account and you deal directly with the broker from that point forward and never really think about the Trust Company again. After all, your actual money is largely held with the clearing firm/broker. The Trust Company is just the umbrella label for trading in an IRA. http://www.proactivefutures.com/ offer good commissions as an alternative to IB, and their clearing firm is Alaron which I believe is affiliated to both Millenium and North Star Trust companies. Regular IRA, Roth IRA ...both can be traded this way. So just roll over that $1 million company pension/401K you've worked so hard to build up for 30 years and speculate it away in the futures markets In the meantime, demand that your Congress representative support the proposal for an LSA if and when it comes up for a vote.
Thanks for all that info. I will have to look into it as well as watch for that vote you mentioned. Thanks again.
I saw Shania Twain on tv a few months ago, and the interviewer said "We reached her at her home in Switzerland, where she lives with her husband, Mutt Lange". Made me smile with understanding. They're not there for the skiing.
Very useful information. Thanks OB. If anyone has had any experience trading futures out of an IRA (having IB as a broker would be a bonus), please post any information which may be useful about the process. Thanks in advance.