A Primer For Those Considering Expatriation

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This primer is authored by Mark Nestmann. His company, The Nestmann Group, Ltd., has helped clients in over a dozen countries open offshore accounts, set up international businesses, obtain second residence and citizenship abroad, and construct suitable legal entities to achieve their wealth preservation goals
A growing number of Americans are frustrated with the way in which their economy has been managed and are becoming increasingly concerned about future measures the government may take to keep its coffers full.

A question that’s arising with increasing frequency is: does expatriation offer a viable protection to those concerned about a more financially intrusive US system?

The answer is ‘yes’, it does offer a completely legal solution for ending your obligation to pay US income, capital gains, and gift taxes on your worldwide income. But it is certainly not for everyone and should only be pursued after lengthy and diligent consideration.

And before you begin dreaming of a tax-free future, you should realize that the United States imposes taxes on a broader basis than any other country. The United States is one of two countries, and is the only major country, that imposes significant income, capital gains, gift, and estate taxes on its non-resident citizens.

In virtually all other countries, individuals end their liability to pay income tax after a sustained period of non-residence, generally one year or longer. But to legally and permanently end U.S. tax liability on their worldwide income, U.S. citizens must also give up their U.S. citizenship and passport. This process is called “expatriation.”

Yes, it’s a radical step. However, if you’re a U.S. citizen, you can make nearly all the preparations for a possible future expatriation without permanently leaving the United States. This is a four-step process:

  • Phase 1. Relocate your assets from the United States to other jurisdictions, preferably where the assets won't be taxed.
  • Phase 2. Identify foreign countries where you would consider living,
  • Phase 3. Obtain a suitable second passport
  • Phase 4. Expatriate—give up your U.S. citizenship and passport
Once you've accomplished the first three phases, summarized here in Part I of this report, the final step—expatriation—is much easier than if you're starting from scratch. Part 2 of this report describes the expatriation process.

Are you a good candidate for expatriation? You are, if:

  • You are comfortable living outside the United States, or are already doing so
  • Your spouse and children are comfortable living outside the United States, or are already doing so; and
  • You have already or can shift most of your income and assets outside the United States.

Phase 1: Relocate Your Assets Outside the United States

With a few exceptions, the Internal Revenue Code imposes taxes on both U.S. source income and foreign source income of U.S. citizens. Non-resident, non-U.S. citizens (also known as "non-resident aliens") pay tax only on U.S. source income, although some U.S. sources of income (e.g., most capital gains) are tax-free.

To prepare for this more favorable tax treatment in anticipation of expatriation, begin moving liquid assets outside the United States to more tax-friendly jurisdictions. Begin selling assets that can’t be relocated (e.g., real estate) so that you may reinvest the proceeds overseas.

Invest only in countries and investments with which you are comfortable. If you are accustomed to buying and selling U.S. securities, consider using offshore bank or brokerage accounts to target non-U.S. securities. If you are an experienced real estate investor, investigate real estate purchases outside the United States. Keep in mind that a targeted investment or real estate purchase may also qualify you for legal residence in some countries (Phase 2) or even a second passport (Phase 3). If you have substantial domestic investments in precious metals, consider selling those holdings reinvesting the proceeds offshore.

The vast majority of foreign banks and brokerages now refuse to accept U.S. citizen clients, especially U.S. citizens resident in the United States unless the client has a residence permit in the country where the account is opened However, banks and brokerages in a handful of countries still accept new U.S. citizen and resident clients and allow them to purchase non-U.S. securities. A few banks in Austria, the Bahamas, Hong Kong, Liechtenstein, Singapore, and Switzerland are suitable for this purpose. The minimum deposits in these banks start at $250,000. Minimum deposits in offshore brokerages start around $10,000. Fees are much higher for banking services and securities trading than in the United States.

Both the accounts you hold offshore, and the income derived from them must be reported to U.S. authorities. The penalties for failing to make these disclosures are draconian. Consult with an expert familiar with the tax and reporting rules for international investments when you file your annual tax return.

Offshore real estate is a non-reportable asset for U.S. investors if owned individually or jointly with your spouse or other individuals. Income or gain from foreign real estate investment is reportable and taxable. Countries offering first-world infrastructure and where real estate is relatively affordable include Argentina, Australia, Canada, Chile, Ireland, Mexico, New Zealand, Panama, Spain, and Uruguay.

Numerous potential “land mines” exist in offshore real estate investments. Among them are the lack of a multiple listing service in many countries, difficulty in establishing good title, and legal provisions giving squatters the right to live on your property. In virtually all cases, a probate proceeding is necessary to convey foreign property to the beneficiaries of a deceased owner. Retain a knowledgeable real estate attorney in the country in which you purchase real estate to avoid problems.

Phase 2: Identify Foreign Countries Where You Would Consider Living

Once you give up U.S. citizenship and passport, you no longer have the right to live in the United States. You may generally make brief visits, but in most cases, you won't be able to stay more than approximately four months annually without becoming subject to U.S. tax on your worldwide income based on the IRC's "substantial presence test" rules discussed in Part 2 of this report. Finding another country to live in is therefore an essential part of any expatriation exit strategy.

Even if you have no plan currently to leave the United States permanently, finding a country that you may wish to relocate to in the future is a prudent safeguard. If economic or political conditions deteriorate in the United States and reach your personal breaking point, having legal residence in a suitable offshore jurisdiction provides a valuable insurance policy.

If you merely want the right to live in another country in the form of a residence permit, but don’t necessary want to be physically resident there, a number of countries can accommodate your needs. These include Belize, Costa Rica, Malta, Mexico, Panama, and Uruguay. In most cases, you can qualify for residence (although not the right to work in the country) by either making an investment or demonstrating a minimum guaranteed pension payment. Residence rights may be purchased in some countries by making an investment of $80,000 or more in real estate or other assets. A guaranteed pension payment of $1,000 or more may also qualify you for residence. In other countries, you may need to qualify on a points system. Some countries have multiple programs to consider.

Phase 3: Obtain a Suitable Second Passport

To end your responsibility to comply with U.S. tax and reporting obligations, you must give up your U.S. citizenship and passport. Without a second nationality in place and passport in hand, however, giving up your U.S. passport would render you a stateless person. Avoid this status, as it makes it difficult or impossible to legally live or travel internationally.

A second passport also conveys numerous other benefits:

  • It gives you the right to reside in the country that issued the passport, and possibly other countries. For instance, a passport from a member of the European Union conveys the right to live and work in any other EU country.
  • It gives you a way to travel internationally if your primary passport is lost or stolen, or if the issuing government confiscates or refuses to renew it.
  • It provides you with the opportunity to travel to countries blacklisted by the government that issued your primary passport. For U.S. citizens, this includes countries such as Cuba, North Korea, etc.
  • It avoids disclosing your primary nationality, should you ever need to keep that a secret. This can be useful if you're ever confronted by militants who oppose the government that issued your primary passport.
You may qualify for a second citizenship and passport by ancestry, marriage, religion, or extended residence in another country. If not, a handful of countries offer “instant” citizenship in return for an investment or contribution. The Commonwealth of Dominica and the Federation of St. Kitts & Nevis are examples of countries with an official, legally mandated, economic citizenship program. (Note: Dominica and the Dominican Republic are different countries.) In all, 13 countries have such programs in effect.

Dominica has one of the least expensive economic citizenship programs. The nationality law of Dominica authorizes the government to waive the normal requirement of seven years of legal residence to acquire citizenship in exchange for a cash contribution or an investment.

There are two options available:

  1. Contribution option: The minimum contribution for citizenship and a passport is $100,000 for a single applicant. Larger contributions qualify your opposite-sex spouse, your dependent children under 30, and qualified adult dependents to citizenship and a passport. You make the contribution only after the government approves your application. Additional costs come to about $35,000, making the total expenditure for a Dominica passport a minimum of $135,000 for a single applicant. Total costs including all fees for a husband and wife for this option come to about $210,000.
  2. Real estate option: Alternatively, you may purchase qualifying real estate in Dominica with a minimum value of $200,000. Additional costs come to a minimum of $90,000.
Dominica passport holders can travel without a visa, or obtain a visa upon entry, to nearly 140 countries and territories, including all 28 member countries of the European Union.

The Federation of St. Kitts & Nevis offers three options to obtain economic citizenship.

  1. A contribution to the Sustainable Growth Fund (SGF). The cost for an individual applicant is $150,000 for an individual; $175,000 for a married couple; and $195,000 for a family of four. Total costs for a husband and wife come to about $210,000.
  2. An investment of $200,000 into an approved real estate project. You can sell this investment after seven years. Total costs for a husband and wife come to about $305,000.
  3. An investment of $400,000 into an approved real estate project. You can sell this investment after five years. Total costs for a husband and wife come to about $520,000.
The St. Kitts & Nevis passport provides visa-free entry, or visa upon entry, to nearly 150 countries, including all EU member countries.

In all cases, applicants must pass a strict vetting process that includes a comprehensive criminal background check.

Bogus second citizenship offerings abound. In recent years, I have received offers to purchase passports from Costa Rica, Nicaragua, the Dominican Republic, Ireland, and Lithuania, among other countries. Some of these offers are outright scams. Others involve illegally purchased or stolen documents. Even if you succeed in obtaining a passport on this basis, it may be revoked at any time and you could be subject to arrest and/or deportation.

Conclusion

Once you've completed Phases 1, 2, and 3 of your four-step plan to disconnect from the United States, you're ready for Phase 4: expatriation. While you may never take the final step of giving up your U.S. citizenship and passport, taking the preparations summarized so far at least gives you that option.

In Part 2: Important Consequences of Expatriation, we explore:

  • The nuts and bolts of expatriation, including the legal process of expatriation
  • The tax consequences of expatriation
  • The immigration consequences of expatriation
  • The pros and cons of U.S. investments once you expatriate
  • The tax consequences should you choose to spend more than a few months each year in the United States after expatriation
Click here to read Part 2 of this report (free executive summary, enrollment required for full access).

This is a companion discussion topic for the original entry at https://peakprosperity.com/a-primer-for-those-considering-expatriation-3/

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I recently read Matt Bracken’s book Enemies Foreign and Domestic and just prior Kirt Schlicter’s Peoples Republic. Both stories are action stories where patriotic citizens with military training take on the growing corruption in the federal government.
Many other authors take on this same issue in a non-fiction manor.
I don’t personally have nearly enough $$ to make expatriation reasonable from a tax avoidance perspective.
But, like most people here, I feel uncomfortable with what appears to be a systematic erosion of personal freedoms in the name of public safety.
Also, there appears to be a systematic dismantling of national (and religious / cultural) identity in the name of “inclusiveness,” but whose real purpose is suspected of being creating homogenized masses without coherent identity, that are fragmented and hence, easy to dominate.
I might be interested in escaping to a non-US location where basic freedom of movement and expression might persist a generation or two longer. Perhaps this would simply be a lower tech state where the electronic control noose was not as developed.
And in an event that may be partially related: Today is the anniversary of the Israeli attack on the USS Liberty during the 6 day war with Egypt.

Though it is difficult to know exactly why this happened --as official denials and a clear cover-up “investigation” happened-- we can guess. That guess is that Israel loyal factions within the US government and the Israeli military together attempted a false-flag attack on a US ship, which was to be blamed on Egypt, to bring the US military into fight for Israel’s ascendance as the regional hegemon. This project was intended to spend the lives of US soldiers for this purpose.

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Probably won’t be on the news tonight and the average American has absolutely no knowledge of it.

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USA Liberty. :slight_smile:

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This set of articles was sad.
Give up citizenship for “wealth preservation”.

  • What about community?
  • What about the company or companies that helped someone get filthy rich in the first place. That community and the people?
  • Is this not the epitome of self interest and greed?
  • Is this not the ultimate extension of global governance. Haves search the globe for self and wealth preservation and to hell with the have nots.
  • 100% of people die, what a pathetic legacy, “I ran away to protect my money!”
Perspective is everything. AKGrannyWGrit
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Granny -
One of the most common questions we’re asked here at Peak Prosperity is: Where are better places to live?
Many folks feel that their current town/city/state and, yes, even country are not sufficiently resilient to deal with tougher times that may lie ahead. So they’re actively looking for input and guidance on better options.
This article (which is an update of one written for this site back in 2012, and thus the one we could publish the most swiftly) is part of a series we’re developing:

  1. Expatriating (leaving your country and/or gaining additional citizenship)
  2. Relocation (moving to a more resilient location in your same country)
  3. Sheltering in place (making the most of your current location)
Most people, by choice or necessity, will go with option #3. Many people on this website, whether they actually end up moving or not, are actively interested in exploring options for #2. More guidance on in-country relocation is one of the top requested topics on this site and at our live events. And for a certain segment of people, #1, expatriation is a real and worthwhile consideration. The topic is broad enough to cover more strategies than just hopping borders (e.g., remaining in the US physically but moving some of your wealth out of reach of the US govt), and is definitely NOT to be considered lightly -- hence the important details discussed in Part 2. Chris and I believe it's important that we offer what insights we can to folks considering any/all of 1-3. It not up for us to determine which is best for an individual -- that's their decision based on their own life situation.
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Well, I can see why Dominica is selling citizenship to rich foreigners in return for legalized bribes. “On 18 September 2017, Dominica suffered a direct landfall from Category 5 Hurricane Maria.[22] Early estimates of damage suggested 90% of the buildings on the island had been destroyed, with infrastructure left in ruins.[23][24] . . . the scale of destruction having left most people homeless and desperate.”
I strongly recommend you check out the physical security of your investment. Unless you’re buying a cat 5 hurricane proof bunker it may not be there after the next hurricane season. In many of these bribes for passports locations you certainly can’t seriously plan to live there if things get bad in the West. Being one of a few pampered multi-millionaires/billionaires in a country of starving people doesn’t sound like a sane bug-out plan. As for tax havens, as their conditions get worse, what stops them from adding annual bribes [oh, sorry, processing fees] for maintenance of your passport. Are you planning on bringing armed mercenaries and their families to protect you from starving locals? How will you feed yourselves?
You know what, US taxes on the uber-rich don’t sound all that expensive in comparison to these schemes. And in case you’re one of those who never read history, you might not know how many US investments in third world countries were confiscated when the starving locals discovered how much they were being exploited by rich foreigners.
So, maybe Dominica gets me an entry to the commonwealth, so Australia/NZ would take me. Given Brexit, possibly not the EU. Cost $500K + with high probability of continuing extortion if US conditions get worse? Is this really a reasonable investment to prevent the possible increase of high-income tax rates in the US?
So let’s be honest here. Our crony capitalism political system just elected a president on a protect the rich platform plank, the only one he’s successfully executed. He’s lowered taxes on the upper 5%. The economy gets worse so the poor demand more benefits. The demand to fund benefits will come from the used-to-be middle class [probably most of us reading this]. Like Sand puppy, I don’t have that kind of money to waste on schemes to avoid paying a fair share.
Unfortunately, US taxes [total] are relatively regressive. 14% SS/Medicare on the poor but the cap eliminates SS tax for those earning above $132,900. Sales taxes (6-8%), state income taxes, property taxes all hit the middle class (say those between poverty and the $133K) hardest.
I see little evidence of successful attempts in the US for a government to “confiscate” money/assets from the uber-rich. In fact, current Fed and tax policy, as well as deliberately ineffective regulation of predatory financial schemes, have exacerbated the transfer of both monetary and real wealth from the middle to the top. So what is it that the financial flight folks fear? That they will extract so much from the middle that the US will become a third-world rabble that demands confiscation of their assets? If so, it will be their own fault. They receive uncountable advantages from doing business in the US and should be willing to pay a reasonable and fair share to maintain the health of the entire country.
Now, if I take Sandpuppy’s thought process to a logical conclusion, it’s not really an economic issue, per-se. The insane refusal of the monied elites to deal with climate disruption is going to produce Dominica/New Orleans/Puerto Rico like disasters on the coasts. Droughts in the west will continue to cause fires followed by catastrophic flooding in denuded areas. River and lake flooding is increasing inland (even the Great Lakes are running high!). After all, rebuilding a devastated city at taxpayer’s expense increases GDP because we don’t require the calculation to deduct the value of the assets LOST. Meanwhile FEMA and insurance money policies force rebuilding flooded structures many times instead of the sane option of buying the property and forcing the people to move to higher ground. So yes, physical conditions could worsen to the point where we need to fear for our personal safety as starving, homeless people pour out of devastated cities willing to do anything to survive.
So as a member of the dwindling middle class remnant, what do I need protection from?

    1. Rich privileged elites who are using their money to prevent sane government policies around mitigating the effects of climate disruption.
    1. Continued shifting of the tax burden from the ultra-rich to the middle.
      -3) Physical threats from starving masses pushed out of unsustainable cities due to bad economic policies and lack of mitigation of effects of climate disruption.
    1. Economic collapses that make it impossible for me to earn a living AND in which my meager savings become worthless due to federal policies that privilege rich elites.
      A few years ago, during a Mexican inflationary crisis, I visited a relative who had retired in Sonora. We asked about the Mexican economic crisis and had he moved his assets to the US. His response. No, my rich neighbors have and I consider it unconscionable. Their self-centered actions are damaging the Mexican economy. If they claim the right to benefit as affluent citizens from living here then they have an obligation to support the country, not pillage it.
      I say the same to the US expats. You have become wealthy on our backs. To now be unwilling to pay some of it back to keep the country going is unconscionable. Continuing to take such an attitude is probably the one thing that can ensure things eventually get so bad that the 90% you’ve pushed into living in near-poverty begin to confiscate your assets with pitchforks and baseball bats if you rig the government to prevent a legal solution.
      The US right has a hard choice. It can rethink the above policies and begin to mitigate both climate and economic disruptions OR it can continue to extract until conditions become so bad that the ultra-left can institute draconian confiscation measures in a futile attempt to reverse the irreversible. If the later happens, I’m not so sure there will be a safe-haven for the pillaging expats anywhere. An American version of the Masad may start hunting them like they pursued the Nazis.
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Options - the poor do not have those in abundance.
I understand your need to post material regularly.
You say “It is not up for us to determine which is best for the individual - that’s their decision based on their own life situation.”
Of course.
Here is the problem. The 3 “B’s” and the 5 “G’s” won’t work for long. (Beans, bullets & bunkers) or (gold, ground, gasoline, grub and guns). Remember Katniss in the Hunger Games, there is a scene where she says “if we burn you burn” a message to the Capitol Panem. The thought process of me and mine got us to where we are today and will be our undoing. Community will be our only salvation. Expatriation is offensive.
Love to see others thoughts.
Granny

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Amen!
 

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is a JHK expression that describes what we’re up to. Lived 30 yrs. in a rural community all armed all suspicious of outsiders all garden all hunt all look out for each other. We’re not worried. I fear for the pain of many.
my 17 yr. old mare has some ovarian cysts, a hormone panel will help me decide surg. or spend her days out as a field horse. This worries me. Her daughter will be of breeding age in another year. She and her brother are a great team, however it will be years to gestate, raise and train replacements. How much time is there?

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Thanks for the info, Chris and Adam. Agree with SP.
My wife and I are proud Tax Donkeys, nayyy, maybe that’s a horse sound, Robie would know.
Humble beginnings, son of a corrections office/beef cattle farmer and daughter of a lawyer/public defender. Both went to grad school and now have good incomes. Combined we pay roughly 15K/yr into SS, a system we will NEVER see the benefit of and a PONZI SCHEME from the beginning that is used and abused by people with less than 11% approval rating but a high 90% re-election rate. We pay 30+K/yr in Fed/state income tax. We pay more into Medicare, which also will be bankrupt in the near-ish future. Our tax dollars are re-appropriated from things with actual meaning (building out alternative transportation systems, alternative energy, supporting regenerative systems, etc.) and instead subsidize big banks, the MIC, factory commodity farms, oil/gas/coal, and on and on. Sure, we use our after tax money and have solar panels, wood stove for reducing natural gas use when possible, buy local grassfed/organic produce, ride bikes to work in summer/fall, we took out our backyard and put in 25 fruit trees, raised beds, berries, etc. but we’re still forced to FEED THE BEAST simply because we work.
As far as I can see, the only solution is to STARVE THE BEAST (reduce legally the taxes you pay to support the current system).
If we take a step back and consider what others are advocating for, whether intentionally or unintentionally, they’re essentially saying people should stay in this country, don’t give up on the POOR BEAST, but continue to FEED THE BEAST. Continue to be taxed, it’s your DUTY to be Tax Donkeys, don’t you know. Your friends, family, and community are Tax Donkeys, so you should be too, if you’ve got any morals that is… Sure, you can pretend like your vote means something (how’d that work out for Bernie Supporters, crickets, errr I mean TRUMP-RUSSIA) but as has been shown here before, it’s rigged, folks.
My wife and I save roughly 70% of net income and hope to retire in 10ish years. We’ll feed the beast for that long, then we’re out.
We work Monday and Tuesday every week to FEED THE BEAST. The best part of it is, when we retire we can use our time to provide for our own needs (cutting firewood, gardening, orchards, raising animals, etc. thereby reducing the money we need to earn to subsist) and none of that time can be taxed.
Whether we do any of that in this country or another country it will depend on how much the spying increases in the coming decades. I’m looking forward (not really) to the day when the health insurance companies buy info from the credit card companies who know exactly what you buy at the grocery store each week (ice cream, anyone) who then gets info from cell phone companies who can ping locations (you were hanging out with someone who had a 550 credit score!) who then talk to the banks who then talk to the IRS (they save 70% of net income?!?!) to create my Citizen Plus Score (TM, Alphabet Inc, all rights reserved) thus influencing how high my negative interest rate is at the bank! Personally, I’m hoping for the great simplification before then. If not, perhaps a chosen simplification by relocating to a country where the spying isn’t nearly as intrusive will be in the cards.
No one is chastising me into FEEDING THE BEAST, but thanks for trying.

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Well said, AK Granny. That’s what my wife and I believe, that’s why we’re working to build up community connections and community assets.
If you’re thinking of moving to Australia, do your homework.
Australians generally have a long cultural tradition of looking after each other — we generally don’t go in for this lone wolf idea — and have never trusted politicians, so the social climate here is already conducive to co-operative efforts. It is to this culturally-ingrained set of values and behaviours that I will look when things get tough. I think also that people will prove to be more resilient than we imagine. I have read that prior to WW2 the British government set up a number of mental hospitals around London, expecting to treat a lot of people mentally damaged by any bombing. It turned out that the people rose to the challenge and did well. We can only hope that a similar response will be forthcoming in the years ahead.
That said, our governments, state and federal, seem to be working towards some kind of dictatorship. Oppressive new laws deal harshly with the rights of journalists and whistleblowers to report on government malfeasance, and a Chinese-style social control experiment is underway in Darwin. Things can change quite remarkably in a few short years. Uruguay was a splendid democracy until, amazingly, it went through a fascist period in the 1970s. This ended, but would it were this to happen again during the long descent?
Unless you have a great deal of money with which to buy your way in, the age limit for ordinary migrants is 42, and you need to have a skill or qualification that the feds deem to be in demand here. Culturally we’re somewhat similar, but only somewhat. Divided by the same language and all that.
Even our conservative politics would in the US be considered leftist. In particular, the US has made the cultural choice to distribute firearms widely among the general public; the Australian cultural choice has been to restrict their distribution as much as possible. The consequences of these two choices have yet to be tested in genuinely trying times.
We are an island continent, meaning that there’s no easy way out if you need to leave in a hurry: there’s no convenient Canada even to bicycle into if you need to get out in a hurry. Airports can be easily shut down; there’s very little passenger shipping any more.
We pursue an extremely foolish policy regarding transport fuels. While we have some crude oil sources of our own, we are letting our refinery capacity dwindle and dwindle, and rely on importing transport fuels from Singapore and elsewhere. If the terminal facilities in Darwin were to be damaged in a cyclone, or to be interfered for some reason with by the Chinese company which now has a 99-year lease of the port of Darwin, rationing would start within 2 weeks. Imagine what effects that would have on food distribution! Our food system is world-class, meaning that it entails unnecessarily transporting foodstuffs over ludicrous distances.
While our banking system is first-class, if conditions get difficult and you’re relying on an income stream originating in the US, how secure is that? Indeed, this proviso applies to any country of relocation unless you’ve transferred your entire asset base to that country.
A lot of these comments apply also to New Zealand.

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I’m not sure about the statement: “Offshore real estate is a non-reportable asset for U.S. investors if owned individually or jointly with your spouse or other individuals.”
Unless you are talking about a primary residence you are living in abroad, real estate would be considered an investment asset like anything else. Google rules for 8938 reporting. The limit is 200K for single taxpayers, which would include most any property in Australia, NZ, Canada and perhaps some of the others you mention.
There are two uses of the word expat at play here. Expat is commonly used to refer to any person living out of their home country of citizenship. I am an expat. But in the context of this article you are specifically referring to giving up your home citizenship, which I have no intention of doing.
I file my US tax return every year, have done, and will do. So fears to rest for Granny and others. It’s not about avoidance. The truth is, most countries have double taxation agreements with the USA, so if you’re earning, and paying taxes, locally in another country, you will owe no tax to the USA even though you file. Most countries tax rates are higher than the USA, shocker that might be to the folks who cry wolf about their tax burden. So the way the calculation works, you’ve already paid 10K of tax to country X, you’d owe 8K, or 6K, were you to pay in USA, so you owe nothing.
The most apropos comment to my situation in the OP is this one: “when you reach your personal breaking point” - which I reached long ago. It had nothing to do with tax avoidance.

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Something to think about when thinking about expatriating elsewhere is whether the locals of the area you go to will welcome you and incorporate you into their community or not. Just because government officials there allow you to come in doesn’t mean the locals are guaranteed to embrace you. Also, as the US continues to offend more countries, how locals presently treat expats (possibly because they like the money you spend there) may change. In a world of increasing stress, “otherization” also increases. So I wanted to inject an “on the ground” perspective of actually living there once all the other paperwork and planning is done.

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If you lived in Germany in the 1930’s would you leave or stay? How about Argentina around 2000? How about Russia during Stalin’s reign? You think we live in a country where our leaders actually care about it’s people? There is an old saying that if want to judge family or country, look at their fruits. What are the fruits of our country. Don’t look good to me, Vietnam, Syria, Libya, Yemen, Somalia, Afghanistan, etc. Our constitution could be toilet paper the way they are destroying it. General apathy and laziness among the masses will make things very ruff with the next downturn.

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Ive done my share of travelling and to be honest I havent found anything better. If you can find me a place with four seasons, protects my right to bear arms, where I can own a good piece of farm land in a rural area…I’ll consider it. In the places that match those criteria, most of them have tax schemes that are even higher than the US, with governments that are even more socialist.
Lets face it, we now have a president that has LOWERED the tax burden of the majority of Americans. No offense Barbara but CNN must live rent free in your brain. The majority of Americans received a tax CUT [ please spare me the links to NYT and WAPO ]. I am far from a wealthy man and I saved 1200 on my return.
We have some of the most resource rich land in the world here in the US. And good, rich farmland can be had cheaper than most places on earth. I own 100 good acres, house, barn, garage all purchased for about 250k. Try to find that in central America, south America, Europe, or anywhere. I’ve looked. I couldnt find it. Many countries have laws that restrict non-native born people from ever owning farm land.
No. We might be in for some hard times but the good old USA is still the best deal around. As Ronald Reagan famously said; “If we lose here there’s no place left to go, this is the last stand on earth”. We must defeat collectivism/marxism/socialism HERE. God Bless America and God Bless President Trump.

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First off, I agree that it is everyone’s duty (who is able) to help starve the beast.
The best way to do so is to make as little money as possible.
You can join with others and own property in many countries as a co-op or limited liability partnership. Then you can grow your own food. (If you’ve been on this site for long, this is a no-brainer!) Neither of those is taxed.
Any money you do make should be from self-employment, preferably by supplying food to others. This tends to be on a cash basis. I am not suggesting “cheating on your taxes,” but should the situation become extreme, it will be easier to ensure you are not being taken unfair advantage of, than if you have an employer, paycheque, and income that is automagically reported to just about anyone who can claim they have an interest, such as insurance companies and credit agencies.
As a co-op or LLC, you can afford yourself and your fellow shareholders certain “perks” that would normally be taxable. Our co-op owns goodies, like computers, electronics, and vehicles, that are bona-fide business expenses, but that would generally come from taxed income to individuals, or that would at least draw undue scrutiny from taxing authorities.
I am a full-time volunteer for our co-op, for which I receive room and board. I dutifully declare the market value of such room and board. It keeps me in “comfortable poverty.” :slight_smile:
But avoid the temptation to use your low status to get government perks. No one gets more scrutiny than a welfare mom!
My strategy is to “ask not what my government can do for me,” and have so little taxable income that the government has no interest is asking what I can do for it. Be a small target.

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[embed]https://m.youtube.com/watch?v=2e490Meuzc8[/embed]

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Don’t forget, US citizenship follows you everywhere:
The Trump Family Net Worth: How Much Is America's First ...

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I’m with granny and Barbara on this one - if our system is failing it’s because of greed and excess. Sure there might be a few lazy, poor people living off of Medicaid, but I think their impact is small compared to the businesspeople and financiers who extract exorbitant sums from the people and society for themselves. The idea to leave with one’s wealth (which was possible to amass only because of all the interlinkages, connections, and opportunity a society provides) and hide in another country, while in some ways appealing seems pretty immoral…just about as immoral as abusing fellow humans to make more money.
Still, quite often this whole system seems unsustainable. The money our government does have seems not to be spent where it is most needed (sustainable transport infrastructure, energy research, eg). We need more taxes on the ultra wealthy but we also need better management of that money and of our resources.
I come to this website for information on the economy, markets, environment, and energy. This article isn’t really what I’m looking for. I felt the same way about the “how to buy up real estate after the market crashes” seminar — feels like we’re just like everybody else waiting for the opportunity to fleece the more gullible and less fortunate. If energy resources are truly finite, then the only way to keep humanity going is to either reduce the population or have everyone stop being so greedy and live within the world’s limits.
Here are some questions I have:

  • when will the market price in the underfundedness of social security and other pensions?
  • given current energy technology, how long could we sustain ourselves by transitioning to solar, etc? What do materials costs look like for acquisition and storage?
  • what’s the true cost of recycling things once you account for the oil used to power the truck that picks up the bottles, the energy to run the recycling factory? Does recycling make sense? For which materials? What’s the percentage return on the original cost?
  • we compare debt to gdp but gdp is an annual number and debt is cumulative. Does this matter?
  • if the government stopped running a deficit and let gdp slide by 1T, how bad would the effects be over the following years if it never ran a deficit again?
  • how much of stock market net flows are coming from corporate buybacks?