17 replies to this topic

[A-ha]

Is there any benefit if I trade my personal stuff through a non-US person's brokerage account? How much tax he pays compared to a single US person. TIA

[Russ]

I think its a 15% withholding tax for non-US investors. Singapore is one of the best places for capital gains taxes...there is none, and I think Belize and a few other countries have that law too.

[nicolasillo]

I think its a 15% withholding tax for non-US investors. Singapore is one of the best places for capital gains taxes...there is none, and I think Belize and a few other countries have that law too.

Or you come to England open an IG Account and you pay no tax at all
Spread betting in non-taxable here

[Russ]

I think its a 15% withholding tax for non-US investors. Singapore is one of the best places for capital gains taxes...there is none, and I think Belize and a few other countries have that law too.

Or you come to England open an IG Account and you pay no tax at all
Spread betting in non-taxable here

What's an IG account?

[nicolasillo]

I think its a 15% withholding tax for non-US investors. Singapore is one of the best places for capital gains taxes...there is none, and I think Belize and a few other countries have that law too.

Or you come to England open an IG Account and you pay no tax at all
Spread betting in non-taxable here

What's an IG account?

IG Index Spread Betting (www.igindex.co.uk - don t know if it exists in the US, I know a friend who uses it in Australia). It s a trading platform and offers almost everything in stock indices, stocks, futures, options, commodities, currencies etc.

[fib_1618]

What's an IG account?

IG is one of many "spread betting" operations located in London where you can bet on just about anything and everything in which a market is made.

All profits are not taxed under UK rules as they are deemed as gambling.

I personally liked doing business with Cantor, but IG is pretty much the leader in this area where it comes to providing a market for stock market bets. It's actually a nice way to play a position...point for point, and it can be based on different levels of bets all priced in Sterling.

Fib

[fib_1618]

Is there any benefit if I trade my personal stuff through a non-US person's brokerage account?

If you are a US citizen, you save nothing. All accounts over $10,000 in value must be reported. If you pay taxes to the home country of the account, you may be able to deduct this but you have to be careful.

If, however, you're thinking of combining funds with "a friend" based in another country, I guess the only tax you'll have to pay is what he/she would have to pay on any profitable proceeds. But if you have losses, you're basically stuck as far as any deductibility is concerned.

Fib

[bullshort]

Is there any benefit if I trade my personal stuff through a non-US person's brokerage account?

If you are a US citizen, you save nothing. All accounts over $10,000 in value must be reported. WRONG (reported by whom, the foreign government to the IRS? This country has no jurisdiction over what foreign governments are required to report to the IRS, and while it has information sharing arrangements under various tax treaties, there is no $10,000 account threshold at which foreign banks or brokerages report to the IRS). If you pay taxes to the home country of the account, you may be able to deduct this but you have to be careful. WRONG (you may be able to claim a credit against US taxes for foreign taxes paid which is generally more advantageous than a deduction).

If, however, you're thinking of combining funds with "a friend" based in another country, I guess the only tax you'll have to pay is what he/she would have to pay on any profitable proceeds. WRONG (the US, unlike most other countries on this planet, taxes its citizens on their worldwide income, regardless of where it is earned or derived; putting your money in the name of a foreigner in order to avoid US tax is at least borderline tax fraud; also, most other countries tax based purely on residency, the US taxes its citizens on their worldwide income). But if you have losses, you're basically stuck as far as any deductibility is concerned. WRONG (if you have a loss it is deductible, subject to the capital loss limitations, assuming you can show that you had some legal ownership of the account from which the loss was generated).

Fib

Not trying to pick on Fib, but with all due respect, he nailed them, unfortunately all wrong [my comments are shown in bold print in the above quote box]. My advice is for you to seek professional advice in this area, not unsophisticated advice as you will probably get from this board. This board is about trading, and there are many experts on that subject, not on the subject of tax advice, particularly as it relates to foreign and offshore "strategies."

[NAV]

Is there any benefit if I trade my personal stuff through a non-US person's brokerage account?

How much tax he pays compared to a single US person.

TIA

The amount of tax a non U.S resident pays on stock transactions done in a U.S brokerage account depends on the tax treaty with the respective country. Most countries have double taxation treaties with the U.S to avoid double taxation. So in short, in some cases, it's a double whammy and in some cases it's beneficial. You need to consult a tax attorney to really understand the vague IRS language of those tax treaties. Be very very careful these days, as these kinds of things borders on money laundering, especially if you are a resident of U.S (Citizen or a Green card holder) .

[A-ha]

Thanks for the info folks, I really appreciate it. I asked it here first to get a quick answer before seeing my accountant tomorrow. For the sake of simplicity, I will tell you what I have in mind. I am US citizen, single and pay ******** load of taxes. The reason I look for a rescue from IRS is the letter I just received. They claim I understated my taxes in 04/05 and I owe them additional 137K which I believe completely delusional. I will dispute it. But at the moment I am trying to find out a better way to handle my individual account in order to minimize taxation in the future. I have family members , non residents, visiting me from time to time. They can open brokerage account here I think... Lets say they opened one in IB. If I transfer my individual account to theirs and trade there, do I get any tax benefit...

Edited by A-ha, 15 October 2007 - 09:02 PM.