February 2017 - Premier Offshore Company Services

How to invest your IRA into offshore hedge funds and active businesses

02/21/2017/0 Comments/in Articles, International Business, Offshore Bank Accounts, Offshore Banking, Offshore IRA/by Christian Reeves

You can invest your self directed IRA in mutual funds, hedge funds, and any active business. There are very few limitations on how you invest your retirement account. But that’s only half the issue. While you can invest in whatever you like, there all kinds of tax costs associated with investing your IRA into a fund or an active business.

Here’s how to avoid the tax penalties associated with investing your IRA into offshore hedge funds and active businesses.

Let me first frame the issue. When you invest your IRA in an active business taxed as a partnership or flow-through entity, or a hedge fund that pays out untaxed ordinary income, you have what’s called Unrelated Business Income (UBI). The IRS wants you to pay tax on these profits before they go into your IRA tax free or tax deferred.

There are two types of UBI that will trigger unrelated business income tax for retirement accounts:
Profits generated from a business/trade: When an IRA or 401k earns profit from an operating business that has not paid business tax on those profits before distributing them to the retirement account, those profits are taxed in the IRA.
Leveraged Real Estate Investments: When an IRA purchases real estate using a non-recourse mortgage loan, the debt financed portion of the property’s profits is subject to unrelated business income tax. Remember that all IRA loans must be non-recourse and that the owner of the account and the account itself may not guarantee the loan.

Unrelated Business Income is income that goes into your IRA from an active business or a leveraged real estate investment. It’s “unrelated” because it’s not the usual type of income an IRA will receive – passive and investment income.

Most UBI is untaxed profits from an active business. UBI is profits on which the business has not paid tax… such as a business operating as a partnership or within an LLC. If it were taxed as a corporation, the business would pay corporate tax on the profits and pass a dividend on to you. Because it’s a partnership or LLC, the net profits are not taxed before arriving in your IRA.

Unrelated business income is taxed in your IRA at Estate and Trust rates. UBIT doesn’t even get its own tables in the US tax code. You need to refer to the Estate and Trust rates

2016 – UBIT Rates
If taxable income is:	The tax is:
Not over $2550	15% of the taxable income
Over $2550 but not over $5950	$382.50 plus 25% of the excess over $2551
Over $5950 but not over $9050	$1232.50 plus 28% of the excess over $5951
Over $9050 but not over $12300	$2100.50 plus 33% of the excess over $9051
Over $12400	$3206 plus 39.6% of the excess over $12400

Basically, this means UBI is taxed at ordinary income rates.

Important tip: UBIT is reported on IRS Form 990-T. You only pay UBIT on profits from qualifying investments. If you lose money in an active business, you will owe no tax. However, you should file Form 990-T every year. UBI losses can be used to offset UBI profits in future years.

Here’s how to eliminate Unrelated Business Income Tax

Unrelated business income tax only applies to investments and transactions in the United States. If you structure your IRA offshore, setup a UBIT blocker corporation, and invest into foreign businesses and hedge funds, you will eliminate UBIT.

You can still access US investments, but you need to structure your investments offshore. If your hedge fund has an offshore feeder fund, you can setup an offshore IRA LLC and an offshore UBIT blocker, to enter the fund through the offshore feeder.

If you invest in a US fund through their US structure, you’ll pay UBIT on distributions. If you invest in a US fund through an offshore feeder, you will pay no UBIT.

The above is focused on hedge funds and leveraged real estate investments. UBIT also applies when an IRA owns an ongoing active business. Other rules apply to active businesses. For example, you can’t invest IRA money into a business or company you own more than 50% of nor can you invest in a business that pays you a “significant” salary.

The same goes for foreign real estate. If you buy US real estate with a non-recourse mortgage, you will pay UBIT on the gain. UBIT will apply to the portion of the property that was financed. So, if 50% of the cash came from your IRA and 50% from a non-recourse mortgage, you’ll pay ordinary income tax (not capital gains rates) on 50% of the profit when you sell the property.

If you invest in real estate outside of the United States, set up a UBIT blocker corporation, and use a non-recourse mortgage, you’ll eliminate this UBIT tax.

To maximize the benefit of foreign real estate investments with your IRA, you need to plan for both UBIT and local capital gains tax. You want to balance your expected returns against the capital gains tax rate you pay in the country where the property is located.

One of the best return on investment vs capital gains tax is Belize. Returns in Belize have been solid for the last 10 years and Belize has no capital gains tax. Yes, their capital gains rate on real estate is zero.

Some of the highest returns in foreign real estate can be found in Nicaragua. This market is growing quickly and attracting a lot of expats and investors. Their tax on rental profits, and their capital gains rate, are both 10%.

So, someone who buys real estate in Nicaragua with their IRA will pay total taxes of 10%. Had you done this in the United States, your total tax bill would have been 33% to 39% (per the chart above).

Investing with your IRA and a non-recourse loan in a tax free country like Belize will save you 20% on ordinary capital gains and 33% to 39% on the gain from your mortgage (UBI gain). Investing in a higher returning and higher tax rate country like Nicaragua will save 23% to 29% in taxes.

UBIT will also apply to an active real estate business. If you buy a hotel, acquire land that you divide up and build homes on, or buy a multi-unit apartment building, you’re probably a dealer in real estate or a real estate professional. Unrelated Business Income Tax will apply to all income earned in your active real estate business.

That is to say, if your IRA operates as a dealer in real estate, you must pay UBIT tax on your profits.

Note that UBIT does NOT apply to passive real estate investments if you don’t use leverage or a non-recourse mortgage. If you buy a couple of rental properties, you’re probably a passive investor. If you buy a hotel or otherwise operate a real estate business, you have UBIT issues.

I hope this article on how to invest your IRA into offshore hedge funds and active businesses has been helpful. To setup an offshore IRA LLC or a UBIT blocker corporation, please contact me at info@premieroffshore.com or call us at (619) 483-1708.

Move your IRA out of harm’s way – a battle is brewing between Trump and the establishment

02/19/2017/0 Comments/in Articles, Offshore Bank Accounts, Offshore IRA/by Christian Reeves

There’s a battle brewing between the establishment and President Trump. Powerful forces are aligning against our President and we’re left hoping the economy and our savings come out of this unscathed.

Gambling all of your retirement savings on red is a foolish risk. No one knows what will happen, but we do know that there’s a political war coming. Even if Trump brings our country out the other side better than ever, it’s going to be a rough few years.

Leaving your retirement account in the United States is like taking your savings to a Vegas roulette table and betting it all on one spin. You might win and you might lose… no one knows what will happen, but your risks are high.

Get your retirement account out of harm’s way immediately!

Take some of your cash off of the table. Leave what you want to risk in the United States and move the balance offshore. Diversify out of the dollar, eliminate country risk, and secure your investments.

You have the right to move any vested retirement account offshore. A vested account is most often an account you had with a prior employer. If you’ve been at the same job for 10 years or so, some of your retirement might have vested… you’ll need to speak with HR to find out.

You can also move most defined benefit plans out of the country. If your plan allows you to rollover or transfer the DB plan into an IRA, you can get it out of the country.

The process of moving a retirement account abroad is relatively simple. We form an offshore Limited Liability Company in a tax free country and open an offshore bank account for that LLC. Then your US custodian invests some or all of your retirement account into this newly formed LLC.

Finally, you’re appointed as the manager of the LLC. This gives you control and the legal right to manage investments in your retirement account.

There’s no need to move your entire account. You can send as much or as little of your account offshore as you’re comfortable with. Many clients start off small and grow their international holdings over time.

Others just build the LLC structure and open an offshore bank account. They hold their cash at their US custodian, ready to sent it abroad at the first sign of trouble.

The demand for offshore IRA LLCs has tripled since Trump took office. The fear is palatable… we can all see that the establishment and the media are all in on destroying Trump. They hate what he stands for and will do anything, including burning down our economy, to thwart his efforts and remove him from the presidency.

The only way to fully diversify your account, and take it out of play, is to get it out of the United States.

Of course, there are benefits to diversifying abroad in addition to the security provided. For example, there will be many international investments available once you get your account offshore. Most of them offer much better returns than you would find in the United States.

You can also decide to hold your IRA account in multiple currencies. You can open an offshore account and diversify out of the dollar. For example, Capital Security Bank in the Cook Islands, offers 11 primary currencies. If you buy a CD, you can access 26 currencies. No FX or brokerage required… just easy access to multicurrency accounts that allow you to maximize diversification without making an investment.

You can also use your retirement account to plant multiple flags offshore and create an escape hatch should you need it.

For example, you might use your IRA LLC to invest in one of the reforestation programs that give you residency and a second passport. You can get residency in Panama with an investment of $20,000 and Nicaragua with $35,000.

Panama is the easiest second residency program and Nicaragua is the fastest. Panama gives you permanent residency after 3 years and the right to apply for citizenship after 5. Nicaragua gives you permanent resident immediately and the right to apply for citizenship after 2 years.

Panama doesn’t require you spend any time in the country to maintain your residency. Nicaragua wants’ residents to become part of the community. Thus, you need to spend 183 days a year in Nica to maintain your residency.

Remember that you get citizenship and a passport in Nicaragua after 2 years. Once you have your passport, you can spend as much or as little time in the country as you like.

For more, see:

Nicaragua is the fastest low cost second passport

Best Panama Residency by Investment Program

I hope you’ve found this article on moving your IRA out of harm’s way to be helpful. For more on taking your retirement account offshore, please contact me at info@premieroffshore.com or call us at (619) 483-1708. We will be happy to work with you to safeguard your savings.

How to report a foreign salary or international business income

02/16/2017/0 Comments/in Articles, Offshore Company, Offshore Company Taxation, Taxation/by Christian Reeves

Here’s how to report a foreign salary or international business income. If you earn money from working as an employee or independent contractor, you need to report it on your US tax return. Here’s how to report income paid by a foreign company.

I’ll briefly comment on income earned from abroad while living in the United States. Then I’ll focus on how to report a foreign salary or other income while living abroad and qualifying for the Foreign Earned Income Exclusion.

If you’re living in the United States and are paid by a foreign company, you have self employment income. This must be reported on Schedule C and self employment tax will apply.

Being self employed means you can deduct any expenses you had, such as travel, equipment, etc. It also means you’ll pay self employment tax in addition to ordinary income tax on your net profits. SE tax is 15%.

Anyone who does not qualify for the Foreign Earned Income Exclusion should report income from abroad on Schedule C. Even if you did the work outside of the United States, if you were a US resident during the tax year, you have US source self employment income that goes on Schedule C.

For example, you’re a US citizen living in California throughout 2017. You travel to Taiwan for 2 months on a special project earning $30,000. All of the work on this project is performed while you are in Taiwan.

This income is taxable in the United States and self employment tax applies. If you paid any taxes in Taiwan, you can use the Foreign Tax Credit to eliminate double taxation.

Same facts as above, but you’re in Taiwan for all of 2017 and earn $100,000. You’re out of the US for 330 out of 365 days and therefore qualify for the Foreign Earned Income Exclusion using the physical presence test for 2017.

If you’re an employee of a Taiwanese company, your US taxes are relatively simple. You file Form 2555 with your personal return (Form 1040), claiming the FEIE and reporting your salary from a foreign employer. Because you earned less than $102,300, you will pay zero US tax on your income.

If you had earned $200,000, and paid tax in Taiwan, you would use the FEIE on your first $100,000 and the foreign tax credit on the second $100,000.

Salary is taxable at 18% in Taiwan and your US rate is probably about 30%. So, you’ll pay 18% on $200,000 to Taiwan and 12% to the United States (30% – 18%) on the second $100,000 which was over the FEIE amount.

If you’d been working in a country that didn’t tax your salary, you would have paid zero tax on your first $100,000 using the FEIE. For example, you could have lived tax free in Panama while working remotely for a Taiwanese company.

If you’re not an employee of a foreign corporation, then you have income from self employment. SE income will be reported on Schedule C which will link to Form 2555 and apply the FEIE.

For example, you’re an independent contractor working in Panama for a company in Taiwan. You earn $100,000, which is paid into your personal bank account. You will pay zero income tax because you qualify for the FEIE. However, you will pay 15% in self employment tax. SE tax is not reduced by the FEIE.

For more on self employment tax for those living and working abroad, see How self employment tax works when you’re offshore

You can eliminate self employment tax by forming an offshore corporation and having your employer (the Taiwanese corporation in this example) pay into that account. You then draw a salary reported on Form 2555 and not Schedule C.

Your offshore corporation will file Form 5471. In most cases, this will be attached to your 1040 behind Form 2555.

Keep in mind that Form 2555 can be used with any foreign corporation. It doesn’t matter if you’re an employee of an offshore corporation that you own or an employee of someone else. So long as your salary comes from a foreign company, and you qualify for the FEIE, you can avoid self employment tax and Schedule C.

An offshore corporation can also help to defer US tax on income over and above the FEIE. For example, you’re living in Panama, qualify for the FEIE, earn $200,000 from work, and are paid into your Panama corporation.

You can take out $100,000 and report that as your salary on Form 2555. You leave the balance in the corporation as retained earnings. You will only pay US tax on this money when you take it out of the foreign corporation, usually as a dividend.

I hope you’ve found this article on how to report a foreign salary or business income to be helpful. For help preparing your US returns, or to setup an offshore corporation in a tax free country, please contact me at info@premieroffshore.com or call us at (619) 483-1708.

Trump’s Tax Plan for Expats

02/16/2017/0 Comments/in Articles, Taxation/by Christian Reeves

Most of Trump’s tax plans will help American expats. If you’re living abroad, and making more than the Foreign Earned Income Exclusion, or have significant capital gains, Trump might cut your US taxes significantly.

First, I should point out that there’s been no indication Trump will attack the FEIE. I don’t expect this Exclusion to be reduced. If you’re working abroad and earning less than $102,100, you’re golden.

Second, note that Trump’s changes to international tax law have been focused on import taxes and preventing jobs from going overseas. Unless you sell a physical good into the United States, his negative tax plans should not affect you.

That is to say, if you’re an expat with a portable business, or an internet, service, drop shipping, or consulting business, Trump’s plans won’t hurt you. So long as you’re not importing into the United States, there’s no need to worry.

Let’s take a look at a few highlights of Trump’s tax plan.

Reduce taxes across the board, with special focus on working and middle-class Americans
Ensure the wealthy pays their fair share, but not so much that it’s detrimental to jobs or undermines the ability to compete
Eliminate special interest loopholes, make business tax rates more competitive in order to keep jobs in the US, and create new opportunities to revitalize the economy
Lower childcare costs by allowing families to fully deduct the average cost of childcare from their taxes

The Trump Plan will increase the standard deduction for joint filers to $30,000, from $12,600, and the standard deduction for single filers will be $15,000. Personal exemptions will be eliminated as will the head-of-household filing status.

In addition, the Trump Plan will cap itemized deductions at $200,000 for Married-Joint filers or $100,000 for Single filers.

Most importantly, Trump’s tax plan will lower personal income taxes and reduce the number of brackets. Under Trump’s plan, our current seven tax brackets will be collapsed into just three.

Lower-income families will end up with an effective income tax rate of zero. According to Trump, a middle-class family with two children would see a tax cut of about 35%.

The proposed income tax rates for a married filing joint taxpayer are as follows:

Less than $75,000 – 12%
More than $75,000 but less than $225,000 – 25%
More than $225,000 – 33%

Tax brackets for single filers will be exactly half of the amounts listed above. This is why there is no more “head of household” or status, nor is there a “marriage penalty.” The single tax brackets are now exactly half of those for married joint filers.

Remember that your first $102,100 will be excluded under the FEIE. So, an expat’s tax bracket will start at 25% and go up to 33% on salary in excess of the Exclusion.

I also note that your bracket begins at 25% and not at 0% or 12%. The excluded $102,100 counts toward your bracket, it doesn’t start at zero as if the income was never earned.

So, someone who earns $200,000 in salary for 2017 will pay 25% on about $100,000 (the amount over the FEIE). If that same person earns $300,000, the first $100,000 is tax free, the second $125,000 is taxed at 25% and the remaining $75,000 is taxed at 33%.

Self employed expats operating through an offshore corporation can manage these taxes by holding income in excess of the FEIE in the corporation as retained earnings. Pay yourself (and your spouse, if possible) the max allowed and retained the balance in your corporation tax deferred.

American expats can eliminate income tax using the Foreign Earned Income Exclusion. There is no such tax break for capital gains. So long as you hold a blue passport, Uncle wants his cut of your passive income.

Trump has suggested he will keep the current long-term capital gains tax rates of 0%, 15%, and 20% but reduce the number of tax brackets from seven to three as described above. Trump’s simplified and consolidated tax brackets, and their corresponding long-term capital gains tax rates are:

Marginal Tax Rate	Taxable Income (Single)	Taxable Income (Married Joint Filers)	Long-Term Capital Gains Rate
12%	$0-$37,500	$0-$75,000	0%
25%	$37,500-$112,500	$75,000-$225,000	15%
33%	$112,500 and above	$225,000 and above	20%

DATA SOURCE: WWW.DONALDJTRUMP.COM

It’s also become clear that Trump plans to repeal Obamacare (the Affordable Care Act), and thereby eliminate the 3.8% investment income tax. Under Obama, most investors were paying 23.8% on long term capital gains. Under Trump that will likely go back to 20%.

Nowhere in Trump’s tax plan is a reduction of self employment or payroll taxes mentioned. Therefore, American expats will benefit from incorporating offshore and running their businesses through an offshore company.

You should report your salary on IRS Form 2555 as coming from a foreign corporation to eliminate self employment and payroll taxes of 15%. For more on this, see: How self employment tax works when you’re offshore.

Remember that self employment taxes are not reduced by the Foreign Earned Income Exclusion. The FEIE applies to income taxes paid against your salary. SE tax is not an “income” tax.

The only way for an expat to eliminate SE and payroll taxes is to operate his or her business through an offshore corporation. This trick alone can save you $15,000 a year if you’re single or $30,000 if a husband and wife both work in the business and max out the FEIE.

I hope you’ve found this article on Trump’s tax plan for expats to be informative. For assistance with an offshore corporation or US tax compliance, please contact us at info@premieroffshore.com or call us at (619) 483-1708.

Can I buy foreign real estate with my IRA?

02/06/2017/0 Comments/in Articles, Offshore IRA/by Christian Reeves

The number one question I get on offshore IRAs, is “can I buy foreign real estate with my retirement account?” The answer is a resounding yes. You can buy raw land, a home, condo, office building, or anything else you like outside of the United States within your retirement account.

In fact, you can buy or invest in just about anything offshore. The only limitations on your IRA are found in Section 408 of the Internal Revenue Code. This says you are prohibited from investing in life insurance, collectibles, and certain coins (collectable coins that are not 99.99% pure). Other than that, you can place whatever you like in your IRA.

Foreign real estate is the most popular investment with our offshore IRA LLC clients. They choose real estate as a way to further diversify out of the US and out of the dollar. To take some cash off the gambling table in the time of Trump and to help grow retirement wealth or turn it into income from rental profits.

There are two ways to buy foreign real estate in your IRA. You can setup a self directed IRA and ask your custodian to make the investment. This is best if you will have only one international investment and don’t want to open a foreign bank account for your retirement account.

The other option is to take your entire retirement account offshore. Get rid of your custodian and take over management of your IRA. Get the entire account out of the United States and under your control.

You can do this by forming an offshore IRA LLC owned by your retirement account. Then this LLC appoints you as the manager and opens international bank accounts at institutions that understand US IRA rules.

The last step is to instruct your custodian to invest your entire IRA into this newly formed offshore IRA LLC. Once the cash is transferred into the IRA LLC bank account, the custodian’s control ends and yours begins.

From here you can buy and sell foreign real estate, trade stocks, buy physical gold, and generally manage the assets of the account for the benefit of your IRA. You are to act as a professional investment manager and “always work in the best interest of the account.”

Once you’re installed as the manager of your offshore IRA LLC, you’re responsible to follow all of the US rules imposed on professional investment managers. This basically means that you can’t personally benefit from your retirement account.

So, you can’t buy a house and live in it, can’t borrow from the account, can’t use IRA funds to pay off an existing or personal mortgage, and can’t combine IRA money with after tax money in one offshore account.

These rules are detailed in IRC Section 4975 and referred to as prohibited transactions. A prohibited transaction is any improper use of an IRA by the account owner or account manager (both of whom are now you), beneficiaries, or any disqualified person.

Examples of prohibited transactions include:

Borrowing money from your IRA
Selling your property to your IRA
Using your IRA as security for a loan
Buying property for personal use

Most of these are self explanatory. I should point out that you are allowed to use loans to by foreign real estate in your IRA. You are just prohibited from pledging your account as collateral for that loan. To put it another way, you can borrow money to buy foreign real estate with a nonrecourse loan. You can’t borrow with a recourse loan that’s guaranteed by the IRA or by you personally.

Above I said that these rules apply to you, beneficiaries and disqualified persons. Disqualified persons are defined in IRC Section 4975(e)(2). Here are the most common disqualified persons:

The account owner (obviously)
A person providing services to the plan such as an attorney, CPA, real estate agent, investment advisor, etc.
A business, corporation, partnership or trust of which you own 50% or more (ownership or control / voting rights)
Your spouse, parents, grandparents and great-grandparents, children (and their spouses), grandchildren and great-grandchildren (and their spouses).

The term “disqualified person” does not include siblings (brothers and sisters) or aunts, uncles and cousins of the IRA owner.

With all of those caveats, you are absolutely allowed to by foreign real estate in your IRA. You can do it through a custodian, if you don’t mind having him in control of the property, or setup an offshore IRA LLC to handle the transaction.

I hope you’ve found this article on whether you can buy foreign real estate in your IRA to be helpful. For more information on taking your account offshore, please contact me at info@premieroffshore.com or call us at (619) 483-1708. We have been assisting clients get their accounts offshore since 2002 and will be happy to work with you.

Just remember that there are risks in taking your IRA offshore. You must follow all the IRS rules and act in the best interest of the account. This means you’ll need ongoing support and an incorporator / advisor who’s an expert in these US rules. If you don’t hire Premier, hire someone in the United States. For more on why you need a US expert, see: Risks in Taking Your IRA Offshore.

Trump’s next travel ban will affect up to 16 million American citizens

02/03/2017/0 Comments/in Articles, Second Passport/by Christian Reeves

Trump’s travel ban prohibiting those from 7 high risk countries from entering the United States for a few months has sparked protests across the country and crocodile tears from Senator Chuck Schumer. This ban affects a relatively small number of foreigners and caught 109 people “in the air,” who were held at US airports for hours on end.

Having been detained at two different airports over my many years of travel, I can relate to their pain. So far, 100,000 US visas have been revoked since Trump’s travel ban and a former Prime Minister of Norway was inconvenienced for a whole hour because he had visited Iran.

No matter your political affiliation, we all feel for those impacted by Trump’s travel ban (maybe not the PM, but everyone else). But these numbers are NOTHING compared to what’s coming for American citizens in 2017!

The Trump IRS will begin revoking or failing to renew the passports of Americans with “significant” tax debts in early 2017. If you owe more than $50,000, your passport can be taken away and you will be prohibited from leaving the United States.

About 16 million Americans, many of them expats, have significant tax debts. Thus, Trump’s 2017 travel ban will affect up to 16 million American citizens. It promises to be the largest travel ban enforced by any country since World War II.

If you owe more than $50,000 to the Federal government, including interest and penalties, your passport and right to travel can be revoked.

Also, the IRS must have made some effort to collect from you. This means that:

The IRS has filed a notice of federal tax liens and 90 days has passed without your filing an appeal.
The IRS must have attempted to levy your bank account.

It’s not required that an agent contacted or visited you. Nor is it necessary that you actually received the notice of tax lien or levy… just that they were mailed to your last known address.

Both of these collection procedures are automated – handled by IRS computers. Anyone oweing $50,000 or more for over 1 year will have had a lien and levy issued, so anyone with an qualifying tax debt can have their passport revoked.

There are some situations where the IRS is prohibited from collecting from you and from revoking your passport. If your tax debt meets the following tests, you will be exempt from the travel ban. If the debt is:

Being paid in a timely manner under an installment agreement entered into with the IRS,
Being paid in a timely manner under an offer in compromise accepted by the IRS,
For which a collection due process hearing is timely requested for a levy, or
For which collection has been suspended because a request for innocent spouse relief under IRC Section 6015 has been made

In all other cases, if you owe $50,000 or more, you will land on Trump’s next travel ban list.

The process of placing a US citizen on this travel ban list requires that the IRS certify the debt (send a letter) to the State Department by stating that you owe $50,000+ and asking them to revoke or refuse to renew your passport.

When asked to refuse to renew or issue a passport, the State Department will hold the request for 90 days.

During this time you can negotiate with the IRS (not State) and attempt to resolve the debt. Your options are to pay in full, prove the debt is in error, or enter into an installment agreement that’s acceptable to the IRS.

There is no wait period allowing you to resolve your debt before the State Department revokes your passport!

Once your passport is revoked or refused ( the 90 day grace period passes), your ability to negotiate an installment agreement is gone. Your only options are:

Pay the bill in full,
Wait out the 10 year statute of limitations or successfully complete bankruptcy so that the debt is no longer legally enforceable,
Pay the bill down so you owe less than $50,000, or
Prove the debt is in error.

If you’re at risk of losing your US passport, there are two ways to avoid Trump’s travel ban. You can buy a second passport from a country like St. Lucia or Dominica, or you can gain residency in a country like Panama and move there.

It will cost you about $130,000 to buy a decent passport. You can get residency in Panama with an investment of $20,000 if you’re from a friendly nation.

However, both of these options must be completed before you lose your US passport. Once you’re on the travel ban list, no country will grant you residency or citizenship. Also, you will be unable to leave the United States, so there will be no way to complete the application process.

I hope you’ve found this article on Trump’s next travel ban to be helpful. For more information on how to settle your tax debt, to buy a second passport, or to negotiate residency in Panama, please contact me at info@premieroffshore.com or call us at (619) 483-1708.

2016 – UBIT Rates