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Monthly Archives: July 2021

Now That You Have Decided to Expatriate – How Do You Emigrate From the US – Things to Consider?

Repulsed by Trump’s vitriolic statements about various religious, ethnic, and cultural minorities, and shocked that he’d become the odds-on favorite to become a major party’s standard-bearer, a not-insignificant number of Americans apparently began thinking seriously about packing up and heading somewhere else.
  • 40% of women younger than 30 would like to leave the U.S.
  • 22% who disapprove of Trump would like to move vs. 7% who approve
  • Canada is top desired destination for would-be migrant Americans
While Donald Trump has spent much of his presidency focused on the number of people who want to get into the U.S., since he took office, record numbers of Americans have wanted to get out.
 

Though relatively average by global standards, the 16% of Americans overall who said in 2017 and again in 2018 that they would like to permanently move to another country -- if they could -- is higher than the average levels during either the George W. Bush (11%) or Barack Obama administration (10%).

Across the pond, The Telegraph observed a similar spike among Britons following the United Kingdom’s shock vote, in June 2016, to leave the European Union.

Indeed, political polarization is straining the social fabric on both sides of the Atlantic and bleeding over into once-apolitical realms. Anyone who’s spent time on the dating scene has a story or two about a date with strong opinions one way or another. This analysis suggests that ideology is indeed a major consideration in singles’ dating decisions.

Politics isn’t the only force driving Americans to relocate abroad. Leery of rising education costs in their home country, many young U.S. citizens go to university abroad. Others take their job searches overseas, seeking out high-growth economies with relatively low living costs. Some seek low-cost countries in which they can stretch their savings further without compromising their laid-back lifestyles. And some move for personal or family reasons, such as reuniting with a foreign-born spouse or parent.

While some countries (such as Canada and Singapore) welcome outsiders, others require aspiring immigrants to submit to grueling tests and numbing bureaucracies. Many (such as Japan) more or less ban permanent immigration. It’s not always easy to tell which is which.

If you’re thinking seriously about making a long-term or permanent move to another country, you must consider the following:

  • What it means to live abroad
  • The best (and easiest) countries to immigrate to
  • General procedures and guidelines for moving abroad
  • General costs and timelines for moving abroad
  • Common considerations and restrictions for prospective immigrants
  • Pros and cons of leaving the United States and moving abroad on a long-term or permanent basis

For a further discussion of each of these considerations go to Money Crashers.

Countries to Consider When Emigrating From the US. 

National immigration policies are highly complex, vary widely from country to country, and are subject to frequent change. That said, a number of politically stable countries have developed reputations for consistently liberal and straightforward immigration policies.

These countries all traditionally welcome immigrants in large numbers (proportionate to national populations), set clear, straightforward rules and expectations for prospective immigrants who wish to live and work there on a long-term or permanent basis, and make it possible (though not always cheap or easy) for non-native-born individuals to become naturalized citizens.

1. Canada

Political Stable Countries Immigration Policies Canada<img class="aligncenter size-inpost_fullwidth wp-image-228739" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-canada-810x455.jpg" alt="Political Stable Countries Immigration Policies Canada" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-canada-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-canada-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-canada-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />

Due to its proximity and political stability, Canada is a popular destination for American expats. Canadian immigration policy favors three broad classes of people: business owners and investors who invest in the local economy, such as in job-creating ventures and real estate developments (business/entrepreneur class); working-age adults with college degrees or sought-after technical and professional skills (independent class); and family members of Canadian citizens or permanent residents (family class).

It is far more difficult for retirees and unskilled workers without family ties to immigrate to Canada. Also, many immigrants are subject to English and/or French language requirements, though non-fluent immigrants are not always disqualified.

To be eligible for permanent resident status, you must spend at least two years of any rolling five-year period in Canada. Canadian permanent residents can apply for citizenship after three years. Canada does recognize dual citizenship for naturalized citizens.

2. Australia

Political Stable Countries Immigration Policies Autralia<img class="aligncenter size-inpost_fullwidth wp-image-228737" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-autralia-810x455.jpg" alt="Political Stable Countries Immigration Policies Autralia" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-autralia-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-autralia-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-autralia-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />

Distance-wise, Australia is about as far from the United States as one can get, but its high standard of living, shared language, and stunning landscapes make it an attractive destination.

Like Canada, Australia favors skilled workers, business owners (including people who wish to start businesses after arriving in Australia), investors who don’t manage the day-to-day operations of the companies or projects in which they invest, and family members of Australian citizens and visa-holders. The Australian government’s special immigration initiatives include a “regional migration” program that expedites entry for immigrants willing to move to small towns and rural regions in Australia’s remote interior, and a “work holidays” program that eases skills requirements for 18-to-30-year-old immigrants who wish to live and work in Australia for up to a year at a time.
Depending on your visa type (for example, a sponsored work visa), you may be able to apply for permanent resident status as soon as you arrive legally in Australia. You can apply for Australian citizenship if you’ve lived in Australia as a non-permanent resident for four consecutive years (so work holidays participants aren’t eligible) and have held permanent resident status for at least 12 months. Australia does recognize dual citizenship.

3. New Zealand

Political Stable Countries Policies New Zealand

<img class="aligncenter size-inpost_fullwidth wp-image-228742" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-policies-new-zealand-810x455.jpg" alt="Political Stable Countries Policies New Zealand" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-policies-new-zealand-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-policies-new-zealand-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-policies-new-zealand-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />New Zealand is even more remote than Australia, which lies approximately 1,000 miles to its northwest. Its amazing landscapes and famously laid-back lifestyle make it a prime destination for immigrants seeking an ideal work-life balance. New Zealand’s immigration system favors skilled workers, family members, and investors. Most workers need a formal job offer from a New Zealand employer to qualify for entry.

Like Australia, New Zealand has a working holiday visa program that allows younger people to stay in the country for up to 12 months at a time. It’s very hard for retirees to relocate to New Zealand, except under special circumstances, such as reuniting with a family member.

To apply for permanent resident status, you must hold a non-resident visa continuously for at least two years. You can apply for citizenship after five years as a permanent resident. New Zealand does recognize dual citizenship.

4. Singapore

Political Stable Countries Immigration Policies Singapore<img class="aligncenter size-inpost_fullwidth wp-image-228741" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-singapore-810x455.jpg" alt="Political Stable Countries Immigration Policies Singapore" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-singapore-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-singapore-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-singapore-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />

Singapore is a tiny nation-state at the tip of the Malaysian Peninsula. Its favorable location at the intersection of several busy trade routes has contributed to its breakneck growth (and comfortable status as one of the world’s richest countries). And, due to its status as an international business hub, English is widely spoken here. But its limited supply of human capital makes Singapore quite dependent on foreign workers. According to the Singaporean Government, approximately 2 million of the country’s 5.26 million inhabitants were foreign-born as of 2011.

Singapore’s immigration policy has changed several times over the years, but the current iteration heavily favors skilled, high-earning workers. In fact, visa classes are awarded on the basis of income. Only relatively high-earning workers, those earning more than approximately $3,000 in U.S. currency per month, can sponsor their families.

You can apply for permanent residency after working legally in Singapore for at least six months. Male citizens must commit to two years of military service, and Singapore does not recognize dual citizenship for naturalized citizens, so many permanent residents choose to forgo citizenship.

5. Brazil

Political Stable Countries Immigration Policies Brazil<img class="aligncenter size-inpost_fullwidth wp-image-228738" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-brazil-810x455.jpg" alt="Political Stable Countries Immigration Policies Brazil" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-brazil-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-brazil-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-brazil-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />

Brazil is South America’s largest country by population and area. Though it’s not traditionally known as a magnet for immigrants, Brazil does have a history of welcoming outsiders. It has the largest population of ethnic Japanese outside Japan itself, for instance.

In recent years, resource-dependent Brazil has stepped up programs to attract skilled immigrants in an effort to address persistent workforce talent deficiencies and boost its service economy’s competitiveness. Retirees with a monthly income of at least $2,000 (U.S. currency) are welcome as well. However, it’s very difficult or impossible for unskilled workers to immigrate to Brazil.
Some newcomers, including investors and business owners, can apply for permanent residence as soon as they obtain their initial entry visa. Permanent residents can apply for citizenship after four years of continuous residency in Brazil, but that time-frame is shorter for certain classes of immigrants, including investors and business owners. Brazil does recognize dual citizenship for naturalized citizens.

One important note: English isn’t widely spoken outside middle- and upper-class areas of major Brazilian cities, so immigrants almost invariably need to learn Portuguese to assimilate fully.
If you’re spooked by some countries’ income requirements for new immigrants, these passive income ideas could give your balance sheet a much-needed boost in retirement (or before).

6. Germany

Political Stable Countries Immigration Policies Germany<img class="aligncenter size-inpost_fullwidth wp-image-228740" src="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-germany-810x455.jpg" alt="Political Stable Countries Immigration Policies Germany" width="696" height="391" srcset="https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-germany-810x455.jpg 810w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-germany-918x516.jpg 918w, https://moneycrashers-sparkchargemedia.netdna-ssl.com/wp-content/uploads/2019/03/political-stable-countries-immigration-policies-germany-90x51.jpg 90w" sizes="(max-width: 696px) 100vw, 696px" />

Germany is the European Union’s largest and most dynamic economy, so it’s no wonder that the country is a magnet for skilled (and unskilled) immigrants. The E.U.’s Schengen Agreement allows E.U. residents and visitors to travel uninhibited across national borders, giving German immigrants access to most of the European continent. E.U. rules also allow German permanent residents and citizens to live and work in other E.U. countries, with some restrictions.

You can apply for permanent residency in Germany following five consecutive years of temporary residency, and for citizenship following eight total, consecutive years of residency. Keep in mind that, as Germany does not currently recognize dual citizenship for naturalized citizens, Americans who wish to obtain German citizenship must renounce their American citizenship. If you plan to live in the U.S. at some point in the future, it’s often better to forgo the German citizenship application.
Also, though many Germans are fluent in English, particularly in major cities, communication is easier (and locals friendlier) in German. Also, the German government requires most immigrants to demonstrate basic command of the native language before entering the country.

Life doesn’t always work out as planned. If you’re upset about the state of politics, stuck in a relationship rut, struggling to make ends meet financially, or just feeling under-stimulated by your current routine, a change of scenery probably seems like a simple, seductive solution to your problems. Who hasn’t fantasized about loading up the car or buying a one-way ticket and heading off to make a new life somewhere exotic and new?

But the grass isn’t always greener on the other side. Many ostensibly liberal democracies, such as France and Germany, face serious political threats from increasingly bold (and popular) nationalist parties, whose members believe religious and ethnic minorities have no place in Western Europe. Others, such as Canada and Australia, struggle with economic problems brought about by falling commodity prices. And some, such as Japan, throw up virtually insurmountable barriers to immigration in misguided efforts to protect their economies and traditional cultures.

You can live in such places for a time, but you might not ever find comfort or prosperity. You may find that sticking around is a better idea after all?

"Should I Stay or Should I Go?"
 
 

Need Advise on Expatriation? 
 
 

Contact the Tax Lawyers of
Marini & Associates, P.A. 

 

For a FREE Tax Consultation at:
or Toll Free at 888-8TaxAid ( 888 882-9243)  

Read more at: Tax Times blog

Biden Issues “Green Book” Listing Its FY 2022 Tax Proposals

The Department of the Treasury has issued detailed information about the Biden Administration's tax proposals for fiscal year 2022 for "the American Jobs Plan" and "the American Families Plan." Traditionally, the tax community has referred to this annual publication as "the Green Book."

The Biden administration has released the Green Book, which details what they wish for as changes to the way income, and specifically capital gains are taxed. Here is a quick summary of the proposed changes:

  • The top marginal individual income tax rate rises from 37% to 39.6%. 
  • The top individual income tax bracket begins at $452,700, down from $523,601. 
  • Capital Gains are taxed as ordinary income for taxpayers with incomes over $1 million. It appears that the "date of announcement" is April 28, 2021, the date that the Administration first detailed this proposal.
  • Carried Interest are taxed as ordinary income for taxpayers with incomes over $400,000. 
  • Any transfer of property (including gifts and at death) will be treated as a sale of the property and the capital gains will be taxed, with gains over $1 million being taxed at the new 39.6% rate(plus the 3.8% net investment income tax).
  • There is an exclusion for transfers to a spouse or to charity. 
  • Tax on illiquid assets can be paid over 15 years. 
  • Tax on a family business is deferred so long as the family operates it. 
  • Transfers to trusts and partnerships triggers the capital gains tax.
  •  Trusts that have been in existence for more than 90 years will be taxed, 
  • There will be no discounts for fractional interest in an asset.
  • Treating certain transfers of appreciated property by gift or on death as realization events;
  • More generous child tax credits, an expanded earned income tax credit, expanded child and dependent care tax credits, and more generous premium tax credits;
  • Eliminating all fossil fuel tax subsidies;
  • Expanding tax incentives that encourage clean energy sources, energy efficiency, carbon sequestration, and electric vehicle adoption;
  • Investments in taxpayer compliance that would provide the IRS with additional resources and information. 

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Sources

Thomson Reuters



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DC Finds Long-time CPA Recklessly Failed to File FBARs


A federal district court found that a long-time CPA and tax preparer recklessly failed to file Reports of Foreign Bank and Financial Accounts (“FBARs”) for his four foreign financial accounts. As a practicing CPA, he clearly ought to have known that he was failing to comply with the FBAR requirements with respect to his foreign accounts. 

Mr. Kronowitz, a U.S. citizen, was a CPA who had been preparing individual federal income tax returns for clients for almost 60 years. For the tax years 2005-2010, Kronowitz had an interest in, or authority over, four foreign financial accounts with an aggregate balance over $10,000 ("reportable interest"). However, Kronowitz did not file FBARs disclosing these foreign financial accounts. In addition, he never conducted any independent research or consulted with another practitioner about the FBAR filing requirements.

Following an examination of Kronowitz's 2005-2010 tax returns, the IRS determined that Kronowitz failed to file FBARs disclosing his interest in the foreign accounts for tax years at issue and assessed civil FBAR penalties for willful failure to file FBARs.

Kronowitz did not dispute that he had an obligation to file FBARs for tax years 2005-2010, or that he failed to do so. However, Kronowitz argued that his failure wasn't willful or reckless.

The district court found that Kronowitz recklessly failed to file FBARs because, as a CPA and seasoned return preparer, he clearly ought to have known that he was required to file an FBAR, and if he didn't know whether he was required to file an FBAR, he was in a position to find out for certain very easily. 

The district court rejected Kronowitz's attempt to establish that his failure to file FBARs was not willful or reckless, but was due to his declining health and memory loss. 

The Court Found That Kronowitz Failed To Show That
His Declining Health And Memory Loss Affected
His Behavior And Cognitive Abilities To Such An Extent
That His Failure To File FBARs Was Not Reckless.

Instead, the court found that Kronowitz's failure to file FBARs was reckless because, if he had taken the time to conduct independent research, or consult with a more knowledgeable tax practitioner, he could have, very easily, discovered that he had an obligation to file FBARs for the years at issue.

Do You Have Undeclared Offshore Income?

 
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Plumber Pleads Guilty to Leaking Funds From Employment Tax Withholdings


On October 29, 2019 we ORIGINALLY posted 
The IRS is Now Criminally Prosecuting Employers For Failure To Pay Withheld Payroll Taxes! where we discussed that the IRS is stepping up criminally prosecuting business owners for failing to turn over withheld payroll taxes.

Since then:

and now according to DoJan Owner of Plumbing Businesses Pleads Guilty to Employment Tax Fraud. 

Thomas O’Connell owned and operated three plumbing businesses, Quality Plumbing and Heating, Orbit Plumbing and Heating, and Orbit PHC, each based in Great Falls. 

From at least 2005 through 2016, O’Connell did not pay employment taxes for several quarters, despite being obligated to ensure such taxes were paid to the IRS. Instead, he directed payments to other creditors and to his own personal expenses. The total tax loss to the IRS from O’Connell’s conduct is more than $550,000. 

O’Connell was scheduled to be sentenced on June 24, 2021, and faces a maximum sentence of five (5) years in prison. He also faces a period of supervised release, restitution, and monetary penalties. 

Additionally the DoJ prosecuted and a New York Business Owner Who Pled Guilty to Payroll Tax Fraud. The owner of a Brooklyn construction business, AD Custom Interiors Inc., pleaded guilty on July 9, 2021 to not paying payroll taxes to the IRS.

According to court documents, as the sole owner and operator of AD Custom, Anthony Riccio had a duty to truthfully account for and pay over to the IRS payroll taxes owed by his employees. From approximately January 2011 through January 2016, Riccio cashed over $3.1 million in checks paid to AD Custom. Riccio used some of that cash to pay wages to his employees. Riccio concealed these cash payments from AD Custom’s return preparer, causing the accountant to prepare employment tax returns that underreported wages and payroll taxes owed. Over five years, Riccio failed to pay $255,433 in federal payroll taxes, including income, Social Security and Medicare taxes, owed by AD Custom and its employees.

Riccio is scheduled to be sentenced on October 21, 2021 and faces a maximum penalty of five (5) years in prison. Riccio also faces a period of supervised release, restitution and monetary penalties. 

Thinking of Borrowing From Your Company's
Payroll Tax Withholdings?

You Better Thank Again, if You Like Your Freedom!


Have Payroll Tax Problems?
 
 
 Contact the Tax Lawyers at 
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