The 100 year old investment-banking firm of Warburg, Dillon Read (on Park Ave. N.Y.) (now UBS Warburg) has offices in 39 foreign countries - including the Bahamas, the tiny Cayman Islands, Hong Kong and the Channel Islands. Makes you wonder why, doesn't it?
Non-resident foreign companies, trusts, banks and individuals can trade stocks, bonds, commodity contracts and options 100% free from U.S. capital gains taxes.
Under the U.S. Tax Code, only when a foreign company, foreign trust or nonresident alien individual takes up permanent residence within the United States will he be subject to U.S. capital gains taxes in the same way as domestic taxpayers. For a corporation permanent residence would be a U.S. office or warehouse. Capital gains realized by foreign corporations and other nonresidents "not engaged in a trade or business within the United States" are exempted from tax under IRC Section 871 and IRC Section 881 & IRC Section 897(c)(3). Moreover, U.S. Treasury Regulations Section 864-2(C)(1) & (2) provides an exception for what embodies being "engaged in a trade or business within the United States". Under U.S. regulations, a nonresident's Stock Market transactions carried-out through a U.S. stock broker, independent agent, or an employee are not considered to cause the nonresident to be "engaging in a trade or business within the United States".
Publicly traded stock market gains (from NYSE, NASDAQ or AMEX listed stocks and bonds) accruing to an offshore company are free of US capital gains taxes by the Internal Revenue Tax Code's statutes, but "US Shareholders" can have a tax liability (indirectly) if the offshore company is a "Controlled Foreign Corporation (CFC) (i.e., "more than 50% of voting and non-voting stock is owned by US SHAREHOLDERS). See sections 951 thru 958 of the IRC. See especially Code-Section 951(b) for the definition of US SHAREHOLDERS.
American taxpayers that use tax havens are taking more risks (generally) than a foreign non-resident alien (not a US citizen). Whether an American citizen taxpayer will have a tax liability on the offshore company profits depends on a lot of things - including what kind of income is produced by the company (i.e., Subpart F or non-Subpart F) and how many shares in the company you own, and whether the offshore company is a CFC - as defined in the Internal Revenue Code in Sections 957 and section 958.
More on the No-tax haven of Anguilla. Click onto the link below for the details
http://www.geocities.com/taxhav
ens123/caribbeantaxhavens.html
A Tribute in Honor of: Bank Confidential Ordinances in the Caribbean
http://www.geocities.com/taxh avens123/bank_confidentiality.html
The Old Monied Dupont Nemours and Roosevelt Families Buy a Tax Haven
Want to know why and how the old monied Dupont Nemours and Roosevelt families were able to buy 4,000 acres of waterfront property on the island of Provindentcials in the tax free, crown colony (or "Overseas Territory") of the Turk and Caicos Islands for 1 cent an acre?
This 4,000 acre sale (now a marina and resort town - with an airport for jumbo jets (the $50,000,000 airport was donated by the UK government) went down in the 1970's - not the 1870's!?!?
Source: A Turks & Caicos Government 3 full page advertisement in Investor's Daily (1985).
Was this the most profitable real estate investment of the 20th century? A quarter acre lot in the gated community of Sandyport here in Nassau, Bahamas sells for approximately $260,000 today. Half acre canal lots in Lyford Cay sell for about one million dollars.
Do the math. On an initial investment of just $40, the 4,000 acre property might be worth almost 4 BILLION dollars today.
YOU BE THE JUDGE.... Are the use of the world's tax havens a blessing or a detriment? Before you answer, see some of the IRS's loopholes from our "Tax Code" - discovered for your viewing below, and buried inside the tax law for the taxpayers! There's a very important loophole for the non-resident alien you should not overlook!
Tom has lived offshore in the Bahamas for over 10 years. When I'm not working on my newsletter, or with a client, I'm out swimming, diving or sport fishing in the sunny- tax-free Bahamas.
Call me at 242-327-7359 with your questions. - 9AM to 5PM - New York time zone is best.
Tom Azzara
New Providence Estate Planners, Ltd.
(Lawyers and Consultants)
54 Sandyport Drive
P.O. Box CB 11552
Nassau, Bahamas
Fax/phone: (242) 327-7359
email: taxman@batelnet.bs
As a sole proprietor, it's wise to familiarize yourself with... Read More
According to the IRS, taxpayers underpay their taxes by some... Read More
As we enter mid-March, taxpayers begin to become very interested... Read More
Many small businesses complain when confronted with the expense of... Read More
How about a Tax Tip?As we all know Taxes are... Read More
To tax or not to tax - this question could... Read More
Whether helping the kids with a down payment on their... Read More
Statistics for IndividualsUnfortunately, the IRS increased its rate of auditing... Read More
As a gentleman was leaving my class recently, he wanted... Read More
If your identity is stolen, your finances can quickly become... Read More
Donating your used car to charity is a win-win situation;... Read More
Beware of advertisements that claim to settle tax debts for... Read More
QUESTION: I have been contacted by my local city... Read More
If your business has employees, you must pay employment taxes.... Read More
Once a year Canadian taxpayers are required, by law, to... Read More
Emerging Legal issues of Tax compliance of e-business Self-assessment system... Read More
An early distribution from an Individual Retirement Arrangement (IRA) or... Read More
"What we've got here is a failure to communicate." ... Read More
Do you realize that some tax forms ask you to... Read More
Should I take wages or dividends from my privately owned... Read More
Millions of people file tax return extensions every year. The... Read More
Deduction of Refinance PointsAny points that you pay in the... Read More
Does your incorporated business pay alternative minimum tax ["AMT]? If... Read More
Small Businesses Filing Amended Federal Tax Returns to... Read More
Estate taxes. It's not enough to simply know they exist,... Read More
All states also have their own tax system. Typically there... Read More
It's a moment every person dreads. You pick up the... Read More
As your business grows, you are going to need help.... Read More
On June 3, 2005, the IRS released guidance on charitable... Read More
You're at your office, or home, and the doorbell rings... Read More
Often people fall on hard times and stop paying on... Read More
In the latest Star Wars episode, the evil empire executes... Read More
The Internal Revenue Service has certified the 2006 Toyota Highlander... Read More
Q: I was contacted by the city tax collector to... Read More
For many business owners the answer to this quandary is... Read More
It's a moment every person dreads. You pick up the... Read More
Ever wish that, as a business owner, you knew exactly... Read More
In the latest Star Wars episode, the evil empire executes... Read More
Should I take wages or dividends from my privately owned... Read More
Most people trying to make a crust online (or offline... Read More
One of the most important, but least understood or appreciated... Read More
We need real tax reform and we need it now.... Read More
On June 3, 2005, the IRS released guidance on charitable... Read More
It's that time again, the April 15 tax deadline is... Read More
As a small business owner, it's wise to familiarize yourself... Read More
The United States is a nation of entrepreneurs. There are... Read More
Whether helping the kids with a down payment on their... Read More
Self-assessment relies on taxpayers voluntarily meeting their tax obligations. This... Read More
April 15 - The most dreaded day of the year... Read More
All states also have their own tax system. Typically there... Read More
Choosing the right tax preparer for your business is a... Read More
You've been feeling uneasy (perhaps even guilty) because you've failed... Read More
"Depreciation." For business owners, this word is the one most... Read More
All tax authorities to e-commerce transactions should investigate the record... Read More
Knock-Knock-KnockWho's there?The IRS!The next quarterly payment of estimated income tax... Read More
We all love to criticize the IRS, don't we? And... Read More
Just image, you are a small manufacturing company, business has... Read More
As we enter mid-March, taxpayers begin to become very interested... Read More
OverviewIn the Pre-Budget Report of December 2003 the Chancellor Gordon... Read More
It may not be high on the list of wedding... Read More
Following is a reproduction of the IRS's rules and requirements... Read More
Background issues of access to recordsTo assess the records at... Read More
Why a Corporation Helps Save You TaxesThe Tax Rates (Notice... Read More
As a small business owner or self-employed person, one of... Read More
Estate taxes. It's not enough to simply know they exist,... Read More
Employers often ask employees to designate the amount of tax... Read More
Tax |