Invest in Privacy Protection By Ted Baumann, Offshore and Asset Protection Editor Last week I wrote about a technique you can use to make yourself largely invisible: Form a limited liability corporation (LLC). As a "juristic person," an LLC can do almost all of the things a real person can do: open bank accounts, register a car, have a phone number, own property and so on. That means you can shift many of your personal affairs into an LLC and limit your personal exposure to the rapidly-degenerating world of Big Data. But there is an exception to this rule. It's one case where holding something in your own name can create a significant privacy opportunity for you … one that can also protect you from lawsuits, wealth confiscation and a range of other threats… How to Lawyer-Proof Your Life 15 million lawsuits were filed in America last year. That's one new lawsuit every 2 seconds. Odds are, you will be the target of a lawsuit soon. In our new edition of Where to Stash Your Cash (Legally) we reveal how you can lawyer-proof your money, and we are giving away 1,000 free copies today … Click here to find out how to claim your free copy now! Location, Location, Location In the real estate business, houses that are indistinguishable from each other can have vastly different market values. That's because the location of a property has a huge impact on its desirability as a place to live. For example, there are spectacular early 20th-century mansions in Detroit that have no market price at all: Nobody wants them. But two things that every property in the U.S. has in common are a place on a searchable deeds register, and a tax valuation. These local and state government records are woven together into searchable national databases. And even if a U.S. property is owned by an LLC, a determined adversary — say, for example, the IRS — can find out who the "beneficial owner" of that property is via LLC records and the IRS itself. That makes it vulnerable to lawsuits and court judgments … including those involving taxation. But that isn't true at all when it comes to property in a foreign country … even when the property in question is owned by a U.S. citizen. A Reporting Loophole If you own property in a foreign country, it doesn't form part of any U.S. property registry or tax database. There's no way anyone can find out that you own it … with two exceptions. The first exception is if you are ordered by a judge, under oath, to reveal all of your personal assets. You can't lie in court. (Even then, it can be incredibly difficult for an adversary who wins a U.S. judgment to act against foreign property — they would have to argue and win their case all over again in a foreign court.) The second exception is if you own a foreign property through a vehicle like a foreign corporation, partnership or other "juristic person." In that case, your ownership interest in that foreign entity is considered a "financial account," and is therefore reportable to the IRS and the Treasury Department under the Foreign Account Tax Compliance Act (FATCA) and the Report of Foreign Bank Accounts (FBAR). That puts the property squarely in the sights of our heavily-indebted government. If wealth confiscation comes to town, the government will just seize other U.S.-based assets to compensate for those it can't attack because they're in foreign countries. But if you own a foreign property in your own name … registered to you as a legal person in your own right … you are under no obligation whatsoever to report its existence to the U.S. government. Even if you earn income from the property, such as rental, you don't have to identity the property when you file your U.S. tax returns. Start Small, Save Big Many people assume that worthwhile foreign-property holdings have to be expensive. That's not true at all. Beachfront properties in stable, growing countries like Uruguay can be had for as little as $100,000. Properties in other parts of that country — and in others — can be bought for considerably less. That's money that nobody in the U.S. need know about … and which will grow in value along with the foreign economy it's in. The only way to isolate yourself completely from the U.S. and its lawyers and tax collectors is to give up your U.S. citizenship. Personal ownership of foreign real estate is a very close second. Kind regards, Ted Baumann Offshore and Asset Protection Editor P.S. Another opportunity has opened up for Sovereign Investor Daily readers, but only for a limited time. EverBank's new MarketSafe® Power MetalsSM CD gives you access to gold, silver and copper, as well as protecting your principal, no matter what. But hurry: This CD is only available until July 9. For the sake of full disclosure, we receive a marketing fee based on our relationship with EverBank. But we'd work with them regardless. Click here for more details and important disclosures. |
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