Lol do you honestly think corporations pay over 10% tax? Come on now. Most people who are considered wealthy or at least "higher class" know how to legally evade tax with "home equity" and shill trust funds to pay as little as the fees associated with them and no tax at all.
Set up in Ireland like google/facebook etc etc for low corporation tax 12%
Kaylanewett - I would not recommend trusting the source you learned this from, as clearly it is willfully misleading and politically-motivated. Google a few financial statements for a random sample of corporations and take a look at how the tax is assessed, as an aggregate, for yourself. Its a cold 40% regardless of the source, unless its some sort of
deferral or
write-off for losses, neither of which constitute a profit.
Every public corporation is paying 40% on
all realized gains. If they weren't complying with this it would be completely unlawful, it would never pass the external audit, IRS would be all over them, and they would quickly be the next Enron.
Dvdgangster - In the real world, the 12.5% tax is not all you'll be paying. At a minimum you'll first pay 12.5% Irish tax, then since this is now legit money, you'll additionally pay either a) personal income tax (45-55+%) or b) 35% corporate repat tax, then 45-55% on the remainder in income tax on the dividend. Sure you can
defer the payment of US tax by simply not repatriating it (which is what Google and the like do), but
you cannot avoid ultimate payment this way. Additionally, a capped home mortgage interest deduction wouldn't help someone that doesn't need a mortgage, and possesses wealth well beyond the limits. And trusts... all I'll say is the pre-WWI era is long-gone. If one did, by some miracle, find a way to avoid IRS, it most likely won't hold up to AMT. Even if it did, the IRS has recently acquired the catch-all that any actions done for the purpose of tax avoidance can be ignored.
Now
OP, I'd like to take a few minutes and really give you my advice, as I am quite knowledgeable in this field. It all depends how much $$$ you're really talking about. I also can't fully tell if your gains are realized, not can I know to what degree the services you've used in the process of acquiring this wealth might be reporting your activities to IRS. This makes a huge difference in terms of your prospects.
First off you talked about putting the money into numbered bank accounts in, among other jurisdictions, Cyprus and Switzerland. Earlier this year, Cyprus confiscated one of its largest banks from its shareholders, and commandeered at least 40% of all deposits. Banking secrecy is completely over in Switzerland, and they showed no remorse in betraying depositors by turning them over to the IRS. Caymans and Bahamas don't openly acknowledge banking secrecy anymore. Singapore just passed a law to shut down banking secrecy. I wouldn't touch any of those, and I'd stay far away from any EU or OECD nation, as they are increasingly hostile to offshore banking and financial services in general.
Be aware that international pressure has objectively grown in the last couple years to take advantage of advances in electronic transfers and coercion to force tax havens into "tax harmonization". Thanks to the OECD and G20, there are currently
no countries that are perfect tax havens (just 10 years ago there were 40+). While they are imperfect, you can still hide your money in some countries: Panama, St. Kitts, and St. Vincent being your principal choices. However, keep in mind you run the risk of changes in laws or enforcement policies. Also, while before you could, you may now find it difficult to invest the deposited money (before banks in Panama would market the ability to make domestic PE investments with deposits). Thus your deposits will most likely merely retain their value via interest, or simply deflate away (although, as someone mentioned earlier, a decent bank will be able to convert your deposit to gold or other fungible goods, though they will probably be redeemable in cash). In this environment evasion becomes futile, and perhaps pyrrhic, in most situations. Thus think carefully before engaging in evasion, though you should not discount the option.
If you are a US citizen, investigate the possibility of moving abroad, with or without US citizenship. As a US citizen, you are taxed no matter where you live. However, if you're willing to move abroad, you can still legally defer realization and live on the
capital value of about $3m with some structuring. You can also grow the money tax-free, although if you realize these gains you'll be subject to tax on the excess amount. Just about any decent international tax attorney could help you with this one pretty easily, thus excessive detail is not necessary if you are serious. Another option is to renounce your US citizenship and move abroad. Here you'll want to keep any amounts above ~650-700k (800k is the official limit) hidden upon the day of renunciation to avoid the expat tax (IRS for 10 years plus a severe, often arbitrary, confiscation of worldwide assets, and IRS on your estate). Once that day has passed, you're free from US jurisdiction, with some limitations. If you're married this is a lot easier and cleaner. Contact an attorney you can trust in the jurisdiction you would plan to move to. Most US attorneys won't give you real advice as they could lose their careers for really helping you with this (unless we're talking about less than the above limits).
You may safely inflate your income with cash-only purchases to the tune of 25% max, but don't go buy a $2m house while reporting $100k in income. Keep in mind that, as much as it kills me to say this, if you stay inside the US and spend the money, you
will get caught, its simply not worth the risk (I really hate saying that)!
There is currently no sustainable way to avoid, and especially evade, US taxation on the realization of any significant income while remaining a domestic US citizen. If you are tricked into believing otherwise, prison and insuperable debt are unfortunately the limits of your future life. Best of luck OP
