The Only Legal Way to Escape US Taxes Besides Death and Renunciation - Puerto Rico

[nbruno322]

The Only Legal Way to Escape US Taxes Besides Death and Renunciation

When I hear about strategies that purport to legally allow US citizens to avoid having to pay income taxes, the first thing that usually comes to mind is that it is some sort of dodgy cockamamie scheme.

This is because the US government is no slouch when it comes to shaking down its citizens for every penny it can get away with. The mind-boggling spending on welfare and warfare policies necessitates this. It would be dangerously foolish in the extreme to think you could slip one past them.

There really was no sure way to legally escape the suffocating grip of US taxes besides death and renouncing your US citizenship… until recently.

Becoming a legal resident of Puerto Rico is the only way for Americans to keep their US citizenship and legally avoid US federal income taxes.

Continued....

http://www.internationalman.com/78-g...d-renunciation

[limequat]

Thanks, interesting article.

[Contumacious]

The Only Legal Way to Escape US Taxes Besides Death and Renunciation

When I hear about strategies that purport to legally allow US citizens to avoid having to pay income taxes, the first thing that usually comes to mind is that it is some sort of dodgy cockamamie scheme.

This is because the US government is no slouch when it comes to shaking down its citizens for every penny it can get away with. The mind-boggling spending on welfare and warfare policies necessitates this. It would be dangerously foolish in the extreme to think you could slip one past them.

There really was no sure way to legally escape the suffocating grip of US taxes besides death and renouncing your US citizenship… until recently.

Becoming a legal resident of Puerto Rico is the only way for Americans to keep their US citizenship and legally avoid US federal income taxes.

Continued....

http://www.internationalman.com/78-g...d-renunciation

Gracias.

.

[KEEF]

since I currently need to be employed, a move to Puerto Rico is out of the question. Now if I can just win that PowerBall Lottery, now we're talking.

[PunkMaister]

That's not entirely true, we may not pay federal income tax but we do pay all other federal Taxes,plus because of the Jones merchant act everything in the island is twice as expensive as it would be on the mainland and the congress has Totalitarian power over whatever federal law or regulation etc. is passed, the only way we have averted some of those damning laws have only been through corporate type lobbying to members of congress from other states by the resident commissioner in Washington since he can only speak but not vote on what affects the island. This colonial status we currently have is both shameful and abhorrent so we either become a full state of the union or a separate sovereign republic.

[69360]

This was very commonly exploited by all the Puerto Ricans when I lived in PA. They would claim residence on the island and pay no income taxes, but collect full entitlements on the mainland.

[Danke]

No, not true.


If you do not have any "taxable income" then you have no liability. Question, does a man in China owe an income tax even though he his paid in FRNs? No of course not.

So what exactly makes you liable?

Learn the law.

http://www.losthorizons.com/

[eduardo89]

No, not true.


If you do not have any "taxable income" then you have no liability. Question, does a man in China owe an income tax even though he his paid in FRNs? No of course not.

So what exactly makes you liable?

Learn the law.

http://www.losthorizons.com/

Do you have taxable income?

[Danke]

Do you have taxable income?

It depends, sometimes yes, sometimes no.

[susano]

Does that mean that if you moved to PR you could cash out your IRA and not pay the federal income taxes?

[eduardo89]

It depends, sometimes yes, sometimes no.

When attractive young women pay you for sex, is that taxable income?

[Icymudpuppy]

What about other territories, such as Guam, the Northern Marianas (including Saipan), etc?

[eduardo89]

What about other territories, such as Guam, the Northern Marianas (including Saipan), etc?

With regards to the Commonwealth of the Northern Mariana Islands:

Under the Covenant, in general, United States federal law applies to CNMI. However, the CNMI is outside the customs territory of the United States and, although the internal revenue code does apply in the form of a local income tax, the income tax system is largely locally determined. According to the Covenant, the federal minimum wage and federal immigration laws "will not apply to the Northern Mariana Islands except in the manner and to the extent made applicable to them by the Congress by law after termination of the Trusteeship Agreement."

[Icymudpuppy]

With regards to the Commonwealth of the Northern Mariana Islands:

Layman's English, please...

[Zippyjuan]

What the IRS says about it:
http://www.irs.gov/taxtopics/tc901.html

Topic 901 - Is a Person With Income From Puerto Rican Sources Required to File a U.S. Federal Income Tax Return?

In general, United States citizens and resident aliens who are bona fide residents of Puerto Rico during the entire tax year, which for most individuals is January 1 to December 31, are only required to file a U.S. federal income tax return if they have income from sources outside of Puerto Rico or if they are employees of the U.S. government. Bona fide residents of Puerto Rico generally do not report income received from sources within Puerto Rico on their U.S. income tax return. However, they should report all income received from sources outside Puerto Rico on their U.S. income tax return. Residents of Puerto Rico who are employed by the government of the United States or who are members of the armed forces of the United States also should report all income received for their services to the government of the United States on their U.S. income tax return.

Special rules apply to civilian spouses of active duty members of the U.S. Armed Forces who work in Puerto Rico but retain their tax residency status in one of the 50 states or the District of Columbia under the Military Spouses Residency Relief Act. If these spouses’ Puerto Rican income is only from wages, salaries, tips, or self-employment, they will only file a U.S. income tax return. For more information on how MSRRA applies to civilian spouses, refer to Publication 570 and Notice 2012-41.

United States citizens or resident aliens who are not bona fide residents of Puerto Rico during the entire tax year are required to report all income from whatever source derived on their U.S. income tax return. However, a U.S. citizen who changes residence from Puerto Rico to the United States and who was a bona fide resident of Puerto Rico at least two years before changing residence can exclude from U.S. taxable income the Puerto Rican source income received while residing in Puerto Rico during the taxable year of such change of residence.

If you are a bona fide resident of Puerto Rico and qualify to exclude your Puerto Rican source income on your U.S. tax return, you must determine your adjusted filing requirement based on the filing thresholds shown in the tax return instructions. For more information about how to determine the amount of income that requires filing a U.S. income tax return, refer to Publication 570 and Publication 1321 (PDF).

If you have no U.S. filing requirement but have income that is effectively connected with a trade or business in Puerto Rico, you must file Form 1040-SS (PDF) or Form 1040-PR (PDF) with the United States to report your self-employment income and, if necessary, pay self-employment tax. For more information on self-employment reporting requirements, see the Form 1040-SS Instructions and Form 1040-PR Instructions.

[phill4paul]

Instead of a job I make a living. These "taxes" I dunno about.

[eduardo89]

Layman's English, please...

Residents of the CNMI do not pay federal income taxes, but rather pay local income taxes.

[MRK]

I pondered this for a while the past couple days.

No matter how you slice it, 0% still beats 4%. And you dont have to live on a crowded island for most of the year with an AC bill of $300 a month.

Next year I will be out of the US for 330 days and will be able to claim a foreign income tax exemption of $97,500. I wont trigger a residential tax nexus in the places I will be. Due to these factors I wont be paying any income tax unless I have an exceptionally good year. Somehow I think it will be pretty good given my increased incentives to earn.

[PunkMaister]

Residents of the CNMI do not pay federal income taxes, but rather pay local income taxes.

The same goes for residents of the commonwealth of Puerto Rico.

[mrsat_98]

No, not true.


If you do not have any "taxable income" then you have no liability. Question, does a man in China owe an income tax even though he his paid in FRNs? No of course not.

So what exactly makes you liable?

Learn the law.

http://www.losthorizons.com/

Do you have taxable income?

a tax on the peoples wages salaries tips and commissions is not an income tax. one has to be doing something taxable to be liable. Average joe is not

[Reason]

Too bad Puerto Rico is a $#@!hole...

Pretty much the same as Mexico.

Was there for 2 weeks earlier this year, never going back by choice.

[PunkMaister]

Too bad Puerto Rico is a $#@!hole...

Pretty much the same as Mexico.

Was there for 2 weeks earlier this year, never going back by choice.

Mexico has people living in cardboard houses, we do not and that's just for starters either you stayed at La Perla or some other really bad neighborhood to come up with that conclusion or you are just posting your venomous generalized hatred for non Anglos.

Funny that you call yourself Reason. Your twisted Ying/Yang symbol tells me you believe that liberty and the state must be in harmony. But they will never be. the only way is to minimize government power to the smallest amount possible as it originally was with the U.S constitution. and only to just see it fail again over time. honestly if this system collapses we should not rehash it and vie for a voluntarist society instead.

[nbruno322]

[PunkMaister]

Very informative thanks,still the current colonial status has just got to go, I mean Singapore is a sovereing republic for crying out loud, so there is just no excuse for continued colonialism and even within the states if we were to become one why not allow such free market zones?

[MelissaWV]

Sorry. I just finished laughing my ass off.

The island has seen a massive amount of flight for many, many, many years. Many. Years. My parents left in 1983. One of my aunts, my uncle, and random extended family members still live there year-round. When we visit, I am reminded of how I could absolutely not live there as things are right now.

Oh boy you don't pay Federal Income Taxes! If the entire premise is to move somewhere where you don't have to pay Federal Income Taxes, but get to maintain your US citizenship and all the wonderful things that come with it, I have some bad news on the latter part of your plan. You won't be voting for President again. You will still be subject to a draft. You will still be paying taxes on any income from certain employers, and from certain income sources off-island. You will be dealing with power outages, an insect problem that refuses to be ignored, (depending on where you live) a lack of air conditioning, a language barrier (for many of you), some of the worst and most creative traffic I've ever seen, hurricanes, floods, mudslides, mainland intervention, a lack of a vote in the same wars that would result in the aforementioned draft, (depending on where you live) violent crime rates that are cringeworthy, your birth certificate randomly being invalidated for your own security, war games resulting in depleted uranium on your shore (in all fairness that's all supposedly cleaned up now, and there are resorts in the areas where the US was bombing), and illegals literally washing up on shore from time to time.

Are there no shacks anymore, PunkMaister? The local government does come in and sweep them off the mountainsides (and hurricanes often perform the same function), but they usually pop back up. No Haitians living in shanties on farm hillsides illegally anymore? There were when I was there not so long ago, though to be fair there were only parts of the shacks since it was just after a storm.

If I won a great deal of money, I would buy up some of my family's homes and land that aren't in the family any longer, and I would try my best to buy up the beautiful beach where I spent so much of my time, but I would not randomly move there to try to make a living and avoid taxation. Again, people have been fleeing for many years. You might want to ponder why that is.