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The Caribbean islands that give you a passport if you buy a home (www.bbc.com)
submitted 10 months ago by to c/mildlyinteresting@lemmy.world
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[–] 21 points 10 months ago (6 children)

If "capital gains not taxed" didn't leap off the page at you, you are a poor slob who must actually have w-2 income? Keep up the good work while the wealthy sleep soundly on the tax code they bought and wrote.

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  • [–] 0 points 10 months ago* (4 children)

    The article is referring to Caribbean taxes not US taxes. If you have US citizenship, you have to pay taxes to the federal government regardless of where you live, work, or earn your money, and don't lose your US citizenship just because you become a citizen of another country.

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  • [–] 1 point 10 months ago (3 children)

    You can in fact, simply give up US citizenship.

    If own the lottery tomorrow, and needed a “no capital gains taxes” state to be a citizen of, this would be sorta tempting.

    Also noteworthy, the IRS doesn’t come after international citizens. Sure they can go after you domestically, but if your accounts are not American accounts and your assets are in other nations, you can just live your life not filing taxes without going back to the US as a citizen.

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  • [–] 2 points 10 months ago* (last edited 10 months ago) (1 child)

    Obtaining a CLN to demonstrate relinquishment of U.S. citizenship has become a lengthy process with high barriers. The total cost of renouncing U.S. citizenship for a person in France, including the cost of preparing the related tax paperwork, has been reported to be € 10 000 – 20 000 on average.[29] Allison Christians of McGill University and Peter Spiro of Temple University have suggested that the complexity and cost of the process, especially the $2350 State Department fee and the potential penalties for failure to file related tax forms, may constitute a breach of the U.S.' obligation not to impose arbitrary barriers to change of nationality, particularly when applied to accidental Americans who have few genuine links to the United States.

    https://en.wikipedia.org/wiki/Relinquishment_of_United_States_nationality

    It's not simple at all and while you can just not file taxes, that's no guarantee you'll get away with it much like someone living in the US not filing taxes.

    Also lottery winnings is not capital gains income it's gambling income and they typically take the taxes out before paying you your winnings. Even casinos do this if you win over $1500 at once on a machine for example.

    Lastly, the premise being put forth here is that someone is using the Caribbean citizenship as a "tax haven" while still living and earning money in the US, not someone leaving the country and never looking back.

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  • [–] 1 point 10 months ago

    Even if you do file with the IRS while overseas, it's much more difficult for them to check things. And it could also be that you don't have to file the capital gains exempt things in the overseas territory, which would give you a clean tax bill from there to give to the US.

    Either way, it's the article that made the claim that this was something of a tax haven. I don't think anyone here is a tax accountant with enough knowledge to know how that works.

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  • [–] 1 point 10 months ago

    You can also just go back to the US. It's only working in the US, paying and subsequently filing taxes, that would cause the IRS to start looking into you.

    Apparently if you're in such a situation you need a tax lawyer, not an accountant. Accountants are mandatory reporters to the IRS, so if you tell them you've not filed taxes they have to report you, while laywers have client confidentiality and would be able to help you try and smooth things over with the IRS.

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