March 12, 2010
Greetings once again from the land of smiles.
First of all, I really appreciate all the responses after yesterday’s letter in which I announced that I will be speaking at the upcoming Casey Research Crisis and Opportunity Summit. I’m really looking forward to meeting with so many of you in Las Vegas.
For some reason, a few subscribers had difficulty with the link that gives more information about the event, so I want to re-post it here in case you’d like to join us:
And with that, let’s move on to this week’s questions:
Stephen asks, “Simon – I don’t recall you mentioning the Seychelles as a potential offshore banking location? Any reasons not to incorporate there and/or open a bank account?”
Seychelles has a reasonably developed financial infrastructure and is a decent choice for offshore merchant processing… but I find it to be expensive to set up a company, and the due diligence requirements are fairly strict.
More importantly, though, I am generally mistrustful of very small countries that rely almost completely on their offshore industries. If the government has a string of bad years, they won’t think twice about imposing new taxes and fees on all the entities incorporated there.
Russ asks, “Simon, I know you’re busy, but I have a quick question regarding GoldMoney.com. Is this account something that must be reported to the IRS as a foreign financial account?”
That’s a great question… a lot of people have asked it, and the bottom line is that there is no clear guidance one way or the other.
On one hand, GoldMoney should not be regarded as a financial account because it exists outside of the banking system and deals strictly with precious metals, which are not regarded by the government as a monetary instrument.
On the other hand, the service is clearly designed to be a banking substitute, and as all administrative and storage facilities are overseas, it certainly could qualify.
Jim Turk, the founder of GoldMoney.com, is one of the people who thinks that it does not qualify as a foreign financial account. Your best bet is to talk to your accountant and decide how you want to proceed.
Robert asks, “My father is Italian and based on my lineage, I am entitled to Italian citizenship. I have already done most of the leg work, aside from getting the required apostilles, but I have been hesitant to complete the process as I live and work here in the good ‘ole USA. In your expertise, would you find this to be a good option for a second passport?”
Western European passports are extremely valuable for most people– they entitle the citizen to live and work anywhere in the EU, and they’re fantastic travel documents, even better than a US or Canadian passport.
With any second passport, though, there are a few things that you really need to watch out for:
First, military conscription is a very real issue in many countries, including Italy. I believe the maximum draft age in Italy is 25, which means that anyone who obtains Italian citizenship between the ages of 18 and 25 must serve briefly in the military.
Second, you should also watch out for tax consequences. At the moment, Italy does not tax worldwide income, but as the economic situation there continues to deteriorate, it is entirely possible that the Italian government may start taxing its expats.
Christina asks, “Simon you’ve written before about the marquee international hospitals in Thailand like Bumrungrad International. Do you have any experience with ‘tier 2’ hospitals? Is there a major step down in quality?
I recently had the pleasure of carting myself off to the emergency room here in Pattaya. I’ve been to the ER in many countries, including in the United States, and as I think anyone could attest, you spend more time waiting around the ER than being treated.
Here at Pattaya International Hospital, though, I was literally being treated within -seconds- of my arrival. As soon as I showed up, I was met in the parking lot by two nurses who took me straight to a bed in the back where they triaged me.
The doctor came within 5 minutes, and he spoke flawless English, having studied in Canada. To me, this speed is a major differentiator in quality and one of the reasons I routinely tell people that, in case I get sick, I really hope that I’m in a country like Thailand.
That’s it for this week! Thanks for bearing with me while I recover.