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  • #61
    Originally posted by Ghetto View Post
    Ok, I’m gonna get real here. I’d never discuss specifics of my finances with someone I know but I’m anonymous here so here goes.

    I’m around 50 and practicing full time. My net worth is around $10 million but is at this time around 2/3 is illiquid. It’s wrapped up in commercial real estate and another medically related businesses I run. Thank God my parents paid for my college and med school so I had no debt and could just borrow money to start my practice when I finished fellowship. Can’t move now because of medical practice and because I’m caring for aging parents and a father in law. My parents (in their 80s) have an estate worth maybe $3 million and father in law (in his 80s) has an estate of $7 million. My wife and I are only children. When they pass we will likely have a combined estate of around $20 million. I have two college age kids that I’m currently putting through school.

    I’m the kind of person who loves travel and foreign languages are a hobby. My wife and I have done many medical missions to Mexico and Honduras. I’d love to do some travel and immerse in different cultures. Wouldn’t mind doing some work for Doctors Without Borders or spending time volunteering on one of the African Mercy ships.

    So let’s say our parents pass away by the time I’m 55. I sell everything and have $20 million in cash. I buy a house in St Kitts or the Bahamas (both zero income tax countries with zero inheritance tax). US exit tax is 23.8% on capital gains but what the heck for discussion purposes I’ll apply that to the entire portfolio. I sell everything in the US and pay $4,760,000 exit tax and renounce my citizenship. That leaves me $15,240,000 to live off of and invest with.

    I’ll live on one of these islands during winter months and invest $10 million. The rest of the money I’ll use to maybe buy a modest house in Ireland and establish residency there and live there during the summer. Ireland is a safe and stable place with decent healthcare. I pay sales taxes there but my investment income is taxed at 0% in my Caribbean home country.

    Uh oh....in a decade I come down with a rare but treatable disease but Ireland can’t handle it and the world expert practices at the Mayo Clinic. I get a visa to the US (remember I paid my exit tax and can travel to the US). I seem to remember lots of Mayo patients are from foreign countries so that can’t be too much of a problem, right?

    So part time in Caribbean as a citizen, part time in Ireland (legal resident), and part time practicing with Doctors Without Borders. Imagine what a $10 million investment portfolio can do with no income taxes and no inheritance taxes when my kids inherit it after 30 years? Surely it would make up for the exit tax I paid to the US after 30 years?
    That's actually not a bad plan, if you would like living in the Caribbean (I personally wouldn't).

    As far as bolded is concerned, you don't need to "imagine". You could probably just run some numbers and get a good idea of what the whole thing would cost you.

    Also, as far as I'm concerned, once I'm at 20 million or so, the marginal utility of an extra 10 million is very low. What is it in your case?

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    • #62
      I'm far from a tax lawyer (you're definitely going to need one) but those who write the tax code aren't stupid. Are your kids planning on staying US citizens? If so, IRC 2801 will be of some interest to you.

      Comment


      • #63
        "Luck plays a part, sure, but for most docs, the luck was being born in the USA. Not a bad place. We need people like you to stay."

        The optimist of either persuasion are actually in favor of productive immigrants moving, assimilating and staying here as well. As with any group dynamics, weeding out the "bad apples" is soooooooo judgemental. That is where differences exist. I consider that to be healthy. Painful but healthy.

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        • #64
          OP, you have obviously thought a lot about. If it’s something that improves your life and happiness, go for it. But doing it for the taxes is kinda silly.

          I lived in the Caribbean for two years. It was a great experience. But the standard of living is no where close to what it is in the US. Taxes would be very low down on the list of things to consider, if deciding to to move. And it sounds like in your situation they may be a lot, but won’t affect your ability to do things you enjoy in any reasonable manner.

          Comment


          • #65
            Originally posted by Tim View Post
            "Luck plays a part, sure, but for most docs, the luck was being born in the USA. Not a bad place. We need people like you to stay."

            The optimist of either persuasion are actually in favor of productive immigrants moving, assimilating and staying here as well. As with any group dynamics, weeding out the "bad apples" is soooooooo judgemental. That is where differences exist. I consider that to be healthy. Painful but healthy.
            Huh? Not sure I follow.

            I was saying:
            1. We are lucky to be born in USA
            2. USA is good place
            3. People who are successful and prosperous can help USA by staying and creating jobs and buying goods and services and investing.

            I did not address immigration into USA. Legal or otherwise.

            Not sure what you are saying. I was not judging anyone other than the OP and I was giving him a compliment.

            Can I say: "He seems like a productive responsible decent person and I would like him to stay?" without someone thinking I am judging some other party?

            Comment


            • #66
              Originally posted by Ghetto View Post
              Ok, I’m gonna get real here. I’d never discuss specifics of my finances with someone I know but I’m anonymous here so here goes.

              I’m around 50 and practicing full time. My net worth is around $10 million but is at this time around 2/3 is illiquid. It’s wrapped up in commercial real estate and another medically related businesses I run. Thank God my parents paid for my college and med school so I had no debt and could just borrow money to start my practice when I finished fellowship. Can’t move now because of medical practice and because I’m caring for aging parents and a father in law. My parents (in their 80s) have an estate worth maybe $3 million and father in law (in his 80s) has an estate of $7 million. My wife and I are only children. When they pass we will likely have a combined estate of around $20 million. I have two college age kids that I’m currently putting through school.

              I’m the kind of person who loves travel and foreign languages are a hobby. My wife and I have done many medical missions to Mexico and Honduras. I’d love to do some travel and immerse in different cultures. Wouldn’t mind doing some work for Doctors Without Borders or spending time volunteering on one of the African Mercy ships.

              So let’s say our parents pass away by the time I’m 55. I sell everything and have $20 million in cash. I buy a house in St Kitts or the Bahamas (both zero income tax countries with zero inheritance tax). US exit tax is 23.8% on capital gains but what the heck for discussion purposes I’ll apply that to the entire portfolio. I sell everything in the US and pay $4,760,000 exit tax and renounce my citizenship. That leaves me $15,240,000 to live off of and invest with.

              I’ll live on one of these islands during winter months and invest $10 million. The rest of the money I’ll use to maybe buy a modest house in Ireland and establish residency there and live there during the summer. Ireland is a safe and stable place with decent healthcare. I pay sales taxes there but my investment income is taxed at 0% in my Caribbean home country.

              Uh oh....in a decade I come down with a rare but treatable disease but Ireland can’t handle it and the world expert practices at the Mayo Clinic. I get a visa to the US (remember I paid my exit tax and can travel to the US). I seem to remember lots of Mayo patients are from foreign countries so that can’t be too much of a problem, right?

              So part time in Caribbean as a citizen, part time in Ireland (legal resident), and part time practicing with Doctors Without Borders. Imagine what a $10 million investment portfolio can do with no income taxes and no inheritance taxes when my kids inherit it after 30 years? Surely it would make up for the exit tax I paid to the US after 30 years?
              I hate taxes, but dude, you have more money than you will ever be able to spend. I don't have as much as you and probably never will catch you but I would not move for taxes. If I never made another penny, I probably would not run out of money before I die. You certainly won't.

              Do you want to do all this crazy stuff so you can die with 30M rather than 20M? Do you think the IRS is not going to go after your kids? I would get an estate planing attorney, actually several and run everything buy them and I would still probably not do it.

              Comment


              • #67
                The point of being wealthy is to be able to purchase the lifestyle that you prefer. That might be retirement in a VHCOL city with first-class travel, it might be golfing all day, it might be some passion project, it might be sitting on the couch drinking beer all day, etc.

                If you upend your life just to hang on to more money when you are already extremely wealthy, then I think you're turning a win into a loss.
                Erstwhile Dance Theatre of Dayton performer cum bellhop. Carried (many) bags for a lovely and gracious 59 yo Cyd Charisse. (RIP) Hosted epic company parties after Friday night rehearsals.

                Comment


                • #68
                  For me, being close to family and friends is priceless. The heck with the taxes.

                  Comment


                  • #69
                    Originally posted by Panscan View Post
                    This seems very complicated. You won the game , who cares about your taxes. Obviously no one wants to pay more than they have to but your money is going to keep compounding. Do you really think the loss in quality of life in the Bahamas or St Kitts justifies any tax savings you’d have ?

                    I think this is something that sounds way better in theory than reality.

                    you have enough money to travel as much as you want essentially , you are golden.
                    That’s the thing. It’s really irritating to me that I pay taxes all my life and then when it’s time to pass my estate to my children the government is going to feed at the trough again and tax the estate again. That’s confiscatory. I’m a conscientious objector to overtaxation.

                    To paraphrase the great thinker Thomas Sowell:
                    ”I’ll never understand why wanting to keep the money you earn is ‘greedy’ yet wanting to tax others to get their money is not considered ‘greedy’.

                    Comment


                    • #70
                      Originally posted by White.Beard.Doc View Post
                      For me, being close to family and friends is priceless. The heck with the taxes.
                      As much as I hate taxes (and that is a tremendous amount), I totally agree.

                      Comment


                      • #71
                        Originally posted by Ghetto View Post

                        That’s the thing. It’s really irritating to me that I pay taxes all my life and then when it’s time to pass my estate to my children the government is going to feed at the trough again and tax the estate again. That’s confiscatory. I’m a conscientious objector to overtaxation.

                        To paraphrase the great thinker Thomas Sowell:
                        ”I’ll never understand why wanting to keep the money you earn is ‘greedy’ yet wanting to tax others to get their money is not considered ‘greedy’.
                        I agree with what you are saying, but I would just consider moving to a lower tax state. Moving out of the country etc. is too much to save on taxes.

                        Moving from MA to NH (a few miles down the road) fine. Even moving from NY to FL, or CA to TX. but to another country? Not worth it.

                        Thomas Sowell is amazing BTW.

                        Comment


                        • #72
                          Originally posted by Ghetto View Post

                          That’s the thing. It’s really irritating to me that I pay taxes all my life and then when it’s time to pass my estate to my children the government is going to feed at the trough again and tax the estate again. That’s confiscatory. I’m a conscientious objector to overtaxation.

                          To paraphrase the great thinker Thomas Sowell:
                          ”I’ll never understand why wanting to keep the money you earn is ‘greedy’ yet wanting to tax others to get their money is not considered ‘greedy’.
                          One thing I meant to ask earlier is if you can expand on the process for establishing residency in Ireland. If it's as easy as you make it sound, it's something I might be interested in doing (for different reasons from you).

                          Comment


                          • #73
                            Originally posted by AR View Post

                            One thing I meant to ask earlier is if you can expand on the process for establishing residency in Ireland. If it's as easy as you make it sound, it's something I might be interested in doing (for different reasons from you).
                            You don't get free Guinness if you live in Ireland. I've already exhausted that route.

                            Comment


                            • #74
                              Originally posted by AR View Post

                              One thing I meant to ask earlier is if you can expand on the process for establishing residency in Ireland. If it's as easy as you make it sound, it's something I might be interested in doing (for different reasons from you).

                              http://www.inis.gov.ie/en/inis/pages...term_residency

                              Here is a link. I don’t think it would be difficult. Heck, I’d love to live in Spain too
                              Last edited by Ghetto; 04-04-2021, 07:50 PM.

                              Comment


                              • #75
                                Certainly looks like you've thought it over. The challenge with tax planning is anticipating what tax laws will be in the future. As you pointed out, there would be exit tax when you renounce your US citizenship. The upside you are hoping for is avoiding inheritance taxes for your heirs.

                                The unknown is what will US inheritance tax code be when that time comes. Of particular concern would be how your estate is treated if the recipients are US citizens. You can look at the current code but obviously it may significantly change in the future. Currently, I believe you would be a "covered expatriate" if you renounce your citizenship. The IRS doesn't forget you were a citizen. You certainly need to discuss with a qualified tax professional before proceeding.

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