What is an
"offshore tax haven?"
An
offshore tax haven is a country, or jurisdiction, that generally has more
lenient financial and banking laws coupled with higher standards of personal
privacy, than your home country. Offshore, in the financial world, means
a tax jurisdiction other than where the investor lives.
What constitutes
a favorable jurisdiction?
A desirable
jurisdiction should be politically neutral, follow a policy of free trade,
not interfere with the commercial activities of corporations established
there, and provide reasonable assurances of personal and corporate privacy.
Language,
the quality of telecommunications, time zones, availability of professional
infrastructure, and other issues are also important. Most popular jurisdictions
have a legal system derived from a western country and greatly favor corporations,
which are non-resident in nature. There must be a solid commitment to the
protection of private property and the promotion of international trade.
What are the
primary reasons for having wealth placed offshore?
Privacy.
Your rights to privacy are all but gone in several nations.
Asset
Protection. To secure yourself against future predatory litigation.
(If you earn $50,000 a year or more, you will be sued an average of seven
times in your life and this number is growing.)
Tax
Planning. Advantageous use of foreign jurisdictions and their tax rules
for reduction of tax liability.
Estate
Planning. Family and protective trusts, (possibly as an alternative
to a Will) for accumulation of investment income and long-term benefits
for beneficiaries on a favorable tax basis.
Is it legal
to have an offshore bank account?
Yes!
It has always been legal for Americans to invest offshore and maintain
bank accounts, investment accounts, etc.; and it likely never will be.
Do I have to
travel abroad to invest offshore?
No.
Offshore investing does not mean that you have to live abroad, or even
travel abroad. Offshore investing can be done from your own home through
qualified professionals who will function on your behalf with reputable
offshore banks and professional firms. Investments within your country
of residence can be purchased on your behalf from an offshore location.
