Dream of Fleeing the Taxman? Get Real
Another April 15 has come and gone and if, like many Americans, you are still feeling bitter about the bite the taxman took out of your wallet, it’s still safe to indulge in a little fantasizing about skipping off to a tax haven like the Cayman Islands. As long as it’s just a fantasy…
With some of the best snorkeling and scuba diving in the world, the Caymans boast the world-class Southern Cross Club on Little Cayman Island where $1,680 per person gets you a five-day and two-tank package while providing somewhat of a tax haven.
This is just one of several tax haven resorts featured on a slide show found at Forbes.com. Forbes doesn’t condone tax cheating, but the Forbes staff was feeling sympathetic to its readers who are feeling the pinch of the annual tax bill when it posted the slide show.
Forbes points out that other than the obvious tax advantages, many tax havens offer exotic locales with tough extradition laws and lots of services that cater to the wealthy.
Okay, now that you have indulged in your fantasy of becoming a "tax-pat," get real. The U.S. government has been cracking down on tax exiles since 1996, making it difficult for people and companies to avoid taxes. Zipping off to a tax haven is not the answer.
Forbes reported that Beverly Hills, CA.-based international tax lawyer Gary S. Wolfe says that while countries such as the Caymans do not impose taxes, that does not apply to U.S. citizens or residents. "The mistake that Americans make is that they go offshore and think that they don't have to pay any taxes," he says. "The reality is that U.S. citizens are taxable anywhere in the world."
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.