Actually living in Puerto Rico is about as good as it's going to get, where you pay almost no federal income tax. If all you care about is taxes. Not a Republican state by any stretch of the imagination, btw.
Living on a boat and avoiding taxes
- Thread starter Fishbird
- Start date
Yeah, I kinda checked it out a couple years ago. Turns out that security and infrastructure is a consideration. I priced out a gated community and office space in the financial district. As I recall, after digging deeper there was also something about the tax structure that for my situation didn't make the entire package so compelling - my accountant didn't think I could show trading income from US and international exchanges as being generated intrinsically from within Puerto Rico.
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First things to do:
- give up US citizenship
- get out of the US
Obviously there is a compulsory step missing before your number 1 :
acquire a second citizenship,
which is not very easy, especially if one wants to get a good passport. And for rich americans, your number 1 seems to be an expensive option as well because of exit tax.
Strange situation americans are in, dreadful to think many other governments dream to ensnare their citizens in a similar net. Similar proposals are brought up once in a while in European countries, so far it is contrary to EU laws fortunately, but for how long ?
For sure on the security piece, when pretty much every house on the island seems to have steel security bars over all the windows and doors it makes you think twice. I am curious about the tax issue you ran into. My understanding, mostly from a couple casual conversations so by no means comprehensive, made it sound like it was a tax mecca for traders and a bunch of hedge fund types who could stomach living on the Island had moved down specifically for that reason. Maybe they were all just trading distressed debt
Everything can be done, at a price. Taxes are always optional, the thing is everybody wants to pay no premium for the option.
For example George Soros, lives in NY, pays almost no taxes in % terms, makes billions offshore. All legally.
If you are ready, willing and able, to cross into the "grey area" (alternatives that the IRS hasn't even considered), there are thousands of alternatives, (not hundreds), to acquire citizenships/passports, move assets without friction, domiciling in tax havens, while living anywhere you want, etc, etc.
If you choose to live in a cruise boat toilet, that's an option too. They will even pay you a salary to clean it.
For example George Soros, lives in NY, pays almost no taxes in % terms, makes billions offshore. All legally.
If you are ready, willing and able, to cross into the "grey area" (alternatives that the IRS hasn't even considered), there are thousands of alternatives, (not hundreds), to acquire citizenships/passports, move assets without friction, domiciling in tax havens, while living anywhere you want, etc, etc.
If you choose to live in a cruise boat toilet, that's an option too. They will even pay you a salary to clean it.
Doesn't need to be the first step. Depends on the road you follow and the money you want to spent on it.
Easiest way to grow money tax free for a US citizen is to have setup a Roth IRA while you were "poor". Trade if very conservatively until your skill level is high, keep adding while you still can.
Second best way, if you're too late to qualify for a Roth IRA, is to setup a SEP IRA. It will be taxed on withdrawal but your annual max contributions are quite high and you can grow the fund tax free.
Second best way, if you're too late to qualify for a Roth IRA, is to setup a SEP IRA. It will be taxed on withdrawal but your annual max contributions are quite high and you can grow the fund tax free.
Actually it appears that legally you are right, according to Wikipedia :
"The United States, which is not a signatory to the 1954 Convention on the Status of Stateless Persons or the 1961 Convention on the Reduction of Statelessness, is one of a small number of countries that allow their citizens to renounce their citizenship even if they do not hold any other "
Now to try to protect own's wealth by giving up one's only passport would appear a very odd choice.
"The United States, which is not a signatory to the 1954 Convention on the Status of Stateless Persons or the 1961 Convention on the Reduction of Statelessness, is one of a small number of countries that allow their citizens to renounce their citizenship even if they do not hold any other "
Now to try to protect own's wealth by giving up one's only passport would appear a very odd choice.