Britannia Radio

Crazy New Laws Limit Your Freedom By Dr. Steve Sjuggerud Friday, May 14, 2010 I am scared… The noose is tightening around us. And here we sit, ignoring it completely. "It doesn't hurt – yet," we think. But it will hurt. Here are just two examples… from bad to worse. Last week, the Senate Budget Committee passed a budget resolution to raise the top tax rate on dividends to 43.4%, the Wall Street Journalreported. The Journal said: Dividends, which are payouts from business earnings, are already taxed at a corporate tax rate of 35%.  The individual dividend tax is a second evy on that same income. And at a rate of 43.4% would take the total tax on each dollar paid in dividends to something like 60 cents. The next example is far more devious… It was hidden in a jobs bill called the "HIRE" Act. But part of the law had nothing to do with hiring… it had  to do with  significantly limiting your freedom. Currency controls – limits on your freedom to move money – were heavily tightened in that bill. (Again, I have no idea why currency controls belong in a "jobs" bill, but there they are.) Already, you have to report any financial assets you hold outside the United States (above a total of $10,000)… With this new law, foreign financial institutions are required to report on the investment activities of U.S. citizens. Banks that try  to protect their customers will be subjected to huge penalties on U.S.-sourced income. The obvious outcome is no foreign bank will want a U.S. customer. That will make it difficult for Americans to hold money outside of the U.S. Holding some of your wealth outside of your home country is  simply prudent. It helps you protect your assets. But that doesn't fit with what the  government needs right now…You see, the U.S. government is desperate for more tax revenue. So right now,it's doing two things: getting ready to increase taxes dramatically… and setting things up so you can't move your money out of reach of a greedier taxman. What can you do? Next week, I'll be heading to a conference offshore in Belize to find out.  (I'll be speaking too. You're welcome to join me – contact Mary  atnagellaw@aol.com  for the details.) In the meantime, here are a couple simple things you can do to hold your wealth offshore:  Own foreign real estate. If the government wanted to seize your foreign bank accounts, it seems like it wouldn't be hard to do under the new laws. But seizing your foreign real estate holdings and bringing them to the States – well, they can't do it. Also foreign real estate holdings don't have reporting requirements. Unlike your foreign bank account, it's more difficult for the government to know what you've got. Own precious metals offshore. The government really wants to know  if you have money in a foreign bank account. But (and you might get a laugh out of this one) the government doesn't consider gold money. Gold doesn't count as a  financial asset. While $10,000 (total, among all your foreign financial accounts) triggers reporting requirements, holding gold offshore triggers no reporting requirements. An important point here…I am not suggesting you do anything illegal. You are not "hiding"money. It is perfectly legal to own foreign real estate. It is perfectly legal to own gold stored outside of the U.S. You are in compliance with the law. But at the same time, you have made it more difficult for the government to reach in and take your wealth. More on this topic, as I learn it, from Belize next week… Good investing, Steve