Comments by "Jeremy Barlow" (@jeremybarlow2291) on "How to Escape An Authoritarian Regime with Dual Citizenship" video.
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Whether or not you are tax resident somewhere outside the US really depends on the rules of each locality. I mean Spain is going to do everything to say you are resident there. Thailand may not consider you a tax resident even if you have lived there two years on say the Thai elite visa. You have to examine the tax residency rules of each locality and structure your lifestyle, business and assets to ensure you aren't tax resident in multiple places, preferably for Americans structured in a way where you aren't tax resident anywhere else, or if you are tax resident somewhere else, it is in a country with a double tax treaty with the US that allows you to structure your affairs to avoid US taxes, and minimize the local taxes too. The US has a lot of DTAs and several Social Security Totalization Agreements that can prove helpful. The country where you decide to become tax resident in such a scenario would be one that it would be most beneficial to have its own Double Tax Agreements with the other countries you intend to spend time in, especially ones that make it clear qualifying for residency in your first choice excludes you from residency in the other place or places.
I mean the general rule would be a short term rental in a place like an AirBNB for 3 months is less likely to make you tax resident than a year long lease you only live at for 3 months, while a place you own and live at for 1 month a year is more likely to make you tax resident than the rental, or at least maintain a tax residency.
There are a lot of broad strokes that vary by country and general rules always have exceptions. I means for Americans the other thing to think about is are you still tax domiciled in the state you lived in before you left. You may be unless you properly severe ties and establish a nona fide residency somewhere else. In some instances it may even make sense to move to an income tax free state particularly one like South Dakota that allows you to obtain a driver's license with a one night hotel stay as proof of residency and a mail forwarder before leaving to severe ties with a state that will continue to tax you like New York or California. You may also need to get rid of storage units, and property ties like a vehicle titled in those states because they want to keep taking a pound of flesh as long as they can.
Exiting the US correctly is phase one. Using the foreign earned income exclusion and foreign housing exemption and foreign tax credits is step 2 of dealing with exiting the US. Not becoming tax resident in the wrong jurisdiction is step 3, becoming tax resident in the right jurisdiction if you must is step 4.
I've looked at the broad stroke tax guides published by Deloitte and Price Waterhouse Coopers for easily 50 or 60 countries to winnow it down to a handful of countries I would even think about becoming tax resident in and amongst those you still have to decide what the tradeoffs are and if the tradeoffs are worthwhile.
I mean the Bahamas, Turks & Caicos, Cayman Islands, and the UAE all have great tax rates at 0% for the most part, but a) do you have the capital to move to them, b) do you want to live full time on a island or in the desert, c) if you can afford one and want to live there can it help you get citizenship in a reasonable period of time if you want or need an alternative passport?
Then you look at a place like Argentina, the tax rate is terrible, it is difficult to exit it's tax net. It has a wealth tax too, but you can get citizenship there in a handful of years potentially and it is relatively inexpensive with a world class city in Buenos Aires and a multitude of climates in the country.
You look at a place like Belize, and it has a mediocre passport for the most part, a tax system that can be very favorable to you, but you wouldn't want to bank there and the Cayes seem relatively safe with the Caribbean beach lifestyle as does Placencia. It takes a fairly long time to get the passport at over 6 years, but it is a relatively easy place to immigrate to, and so are some other places.
You can move to Thailand or the Philippines relatively easily, but you are unlikely to ever get citizenship in either country and if you do, they are not great passports and dual citizenship is a no go for naturalized Filipinos. If you structure your affairs correctly you are unlikely to be liable for tax in either country even if you are there almost all year. It's not impossible to become tax resident in either country, but taxes can be avoided even as a resident with proper structuring.
Mexico has a great passport, it's relatively easy to move there if you have some location independent income, you can naturalize in about 6 years or so, but taxes are extremely high in Mexico and even with a double tax treaty with the US it has a lot of tax risk for a US citizen who becomes resident there and leaving can be hard with its own exit taxes.
Portugal has the NHR which can be beneficial for taxes, but you have to structure your affairs very precisely to benefit from it and you may have exit taxes to pay when you leave on capital gains. It has a fantastic passport which you can get in six or so years of living there, but you have to structure things just right not to get hit with high tax bills if you become tax resident there. If you can afford the golden visa investment you can be resident for the purpose of pursing the citizenship and may not become tax resident, but I think that to obtain the citizenship will involve spending more time there than the minimum to maintain the golden visa, but maybe less than the 183 days in 12 months to become tax resident, but you still might be found to have Portugal as your center of interest, and if that happened on the second year you were there, no NHR for you and really high Portuguese taxes.
All of this is to say the risk reward ratio. Has to be examined for anywhere you are considering and you need to know what does and does not make you tax resident. You also need to know the incentive options available to immigrants if any. You need to figure out it you want to pursue s citizenship by naturalization and residency anywhere or save up and obtain a citizenship by investment.
I mean Dubai is an expensive place to live, but it offers a pretty great tax benefit if you can afford to become tax resident there and can structure a company properly. If you structure trips to other places during the hottest parts of it's year, you can avoid the heat and maintain a tax residency there and with the tax savings maybe buy a CBI.
Figuring out what place interest you, what the tax rules for each place are and how to avoid residency where you don't want to be resident, or become resident in a favorable jurisdiction if you want that is about doing the research. PWC and Deloitte have good resources online to start researching the taxes. Wikipedia does a good job of telling you what countries have what visa free access where to help you figure out where it might be a good place to get a second passport. The next step after that is a lot more google searching and talking with local lawyers and accountants in the countries you are interested in.
This is not a one size fits anyone process.
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