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What if I wanted to pay something in taxes?

Yitzhak

Yitzhak

Corporate Services
Business Angel
Sep 17, 2012
50
11
8
46
San Francisco, CA
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#1
So, looking into it a little more, it looks like there are some tax loopholes in Cyprus you can drive a truck through. It's awesome if you don't want to pay anything in taxes, but for the sake or argument... what if I wanted to make sure that something was paid? My thinking is that if nothing is paid, the US can come after me with it's absurd tax rates. But, if I made sure that something was paid in Cyprus, I should theoretically be covered by the double taxation avoidance treaty with the US. Is there a special classification I need to look into to make sure I pay something?
 
#3
Doesnt work that way. A person foreign to the US is also foreign to its tax laws. And importantly, as the IRS is not an agency of the US, a foreign corporation must also be foreign to the IRS plane of jurisdiction.


Meaning, a different country corporation means free and clear of Uncle Sam. That corporation being of a country without tax treaties with IRS and the corporation not doing trade or business with US persons means no IRS jurisdiction.


There will not be a situation where you only have to pay a "little" tax. The corporation is either a taxpayer or non-taxpayer.


Yitzhak. What are you goals in order of priority?
 
#4
Hey TVentures,


I'm just trying to get my head around this. This isn't simple stuff.


All I have for reference material is the web, which honestly feels like trying to write code against a new language api without the right version of the manual.


What I'm trying to accomplish is this:


1. An effective layer of deterrence for potential patent suits for the business I would like to create.


I want to work in e-commerce infrastructure, which is prime territory for trolls. It's also the big reason shopping carts and related systems haven't really changed much in the last 20 years. Like we talked about yesterday, without preparing the right structure I'm a sitting duck.


2. The lowest possible tax rate. The less I have to pay the tax man, the happier I'll be. They have too much of my money as it is.


3. Not going to prison for screwing up obscure details related to #2.


Since this post, I did more research on offshore holding company structures. I think I was confused by the fact that a holding company is considered an investment vehicle, and does not conduct "business" of it's own; and it works by splitting out things like trademarks, r&d and marketing vehicles into their own insulated structures. I'm still confused, but I feel like I'm less confused.
 
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#5
Yitzhak,


No worries. No it is not simple to understand though it can be simply achieved.


Goal 1: Solution: (bringing no tax issues into the pictures) Any Company who runs/owns the IP is indebted to another Company for an amount. The other company has filed a UCC-1 against the IP Company. Anyone suing or bringing claim against the IP Company would have to pay the UCC-1 debt before they would be allowed to receive any amount they believe is owed them. US Law. There are legal elements to the transactional paperwork for the "debt"


Goal 2: What is your originating jurisdiction? Where would the IP Company be doing business? Do you have a household? Will the revenue from this IP Company be your only revenue to rely on? What is your budget for annual costs to maintain renewal fees for a structure? More questions after these answers.


Goal 2: You need to find someone who you are willing to pay or they are willing to be your friend who can teach you 'How to be Corporate' and the 'Law of Capacities' and 'Privacy Solutions' and other knowledgeable information


Holding companies do not do business. Typically. Business is defined in law as "profit making motive". Some decide to do profit and thus have 'dividends' to the shareholders. Others choose to hold all monies until a time needed or use it to invest or other so that the employees and boards get paid astronomical salaries. Key, no dividends to a shareholder means no profit. The operating agreement of such a holding company would have to have a clause stating that upon dissolution all remaining monies not expended will be donated or gifted away.


Like said previouslly before. At least three structures for assets (real estate, buildings, trademarks, patents), monies (liquid and securities), and revenue (this is the business end). The perfect model does not end there.


These are upper eschelon "insights" which are typically expressed in to clients who receive invoices in six figures. Not general web ideas from the 50 million "Offshore Template Reseller". Do your due diligence!
 
#6
TVentures,


This information is extremely helpful, and I sincerely appreciate it. I feel like I've learned more about this stuff in the last week, and than I have in months of obsessively digging through information on offshore incorporation websites and wikipedia.


I thought your solution for UCC-1 debt was clever. I'm curious though: Is there a good number that makes sense for a UCC-1 filing? Do we want it to be a high number? Or does a lower number make more sense?


My originating destination is going to be Kansas City area, but that could change if the right opportunities present themselves. It probably won't, but it could, if I can get a deal on distressed corporate assets or useful IP that brings me to market faster.


Kansas City makes a lot of sense to me. There's a lot of talent, both experienced and fresh out of school. Market rates for labor are reasonable. Incorporation of the operating company would probably happen on the Kansas side (rather than the Missouri side) because of the upcoming changes in state laws regarding business taxation in January. Brownbeck seems to have lost his mind, but I'm not going to question it. No state taxes on operating is the best deal in the midwest.


Yes. I have a household. Three people in it. My wife, my daughter, and me.


Tentatively, I was planning on the income from the startup to be my main source of income. I think I can ballpark how much the company will bring in on the low end and what the operating costs would be, based on what I've seen companies with similar business models and products do over the last few years, if it helps.


I've entertained the idea of buying the office building the operating company would reside in, and rent out the surplus space for a secondary income. Office buildings in KC are still relatively affordable, and it wouldn't stress my larger budget as much I would have thought before looking into it. My feeling was that it would make sense with the kind of structures we're talking about creating; and it would also be useful in a possible worst case scenario, where money is tight, and contingency time is needed. I haven't made any formal plans to buy office space, though.


For renewal fees, I was hoping that the whole thing could be done for less than $9,000 a year, including three US trademarks. I don't have a lot of experience in this area, but it seems to me that having good legal council is critical. Does that sound low end? Does it make sense to shoot higher? Only problem is that I'm funding this whole thing from savings initially (next few months), and initial expenses are going to be challenging.


Thanks again.
 
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#7
Yes, websites and wiki's boil down to reseller knowledge and not knowledge from a lawyer. ;)


Yes there is a good number. In order to be a valid debt there must be a transfer of money. This is easy when one understands what is "money" and "notes" in commerical law. Then there needs to be an object or service purchased. Service is an easy and truthful viable option for any contract. Consulting service is a major "go-to" If one does not / can not understand enough, and they wish to only use "hard" purchases, it is not a crime to buy an office equipment for lots of money.


I wasnt expecting your reply to be so forward. Perhaps we should PM from here on out.
 
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#8
Yeah. Some of it has been pretty good. I was impressed with how much information Fidelity Offshore puts out. But I gather from what I'm reading around the web that projects like mine are unusual in IBC circles. Don't know why. Given the state of affairs in the industry, it really should be the first thing people would think of.


I'm actually familiar with monies vs notes. I spent two years on a popular Real Estate financing app awhile back. Like I said, not an expert, but I understand the basics on this one.


Funny story, I did some consulting work a few years ago for this guy who would sell himself computers for $100,000 a piece. Then he arranged a payment situation, where he would gradually pay himself back over a very long period of time. Doing the math on it, I figured that in computers alone, the company owed him somewhere in the area of $5,000,000. Not bad on a $300 to $500 per piece investment. Actually thought the idea was pretty novel, at the time. In this case, it might help that I'm coming in it with a non trivial amount of my own IP, and exclusive licenses from other software houses that are very difficult to get. Yes, consulting! I hadn't thought of that. Good one!


Sorry about that. I don't really have anything to hide, since I'm planning on breaking no laws. And Yitzhak is a common enough name that I'm not all that worried about it.


I tried to get that working. Apparently they have PM's locked down on this site. I'm not hard to find though. A quick Google search for "Sprite Gladstone Corporation" yields useful information.
 
#9
Your search criteria yields no results. Google bubbles you unfortunately and due to my search history, google does not work very well for me anymore. Maybe that is the problem, but then again I am not the IT specialist. So unless your initials are S. Y. M. then the previous information used in other posts of yours was not sufficient.


I do not know why the PM feature is still unavailable. @Admin
 
#11
Yitzhak said:
Funny story, I did some consulting work a few years ago for this guy who would sell himself computers for $100,000 a piece. Then he arranged a payment situation, where he would gradually pay himself back over a very long period of time. Doing the math on it, I figured that in computers alone, the company owed him somewhere in the area of $5,000,000. Not bad on a $300 to $500 per piece investment. Actually thought the idea was pretty novel, at the time.
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Yes this works. But has a very very fine line. To do this with safety the upmost sufficient and proper structures need to be setup. Liens need to be in place. And proper promissory notes. Etc. In America, there is a much much easier way to pay an employee or servicing company much value but very little in "notes".
 
#20
billywonder said:
I say Yitzhak and TVentures are one and the same person... be careful:ban:
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Please stop insulting other members, infraction given! We are watching each post made on the forum almost instantly. Please rest assured that if something improper or posts containing spam or hidden advertising show up we will take immediately action. However, I think you for you attention and do hope you still enjoy.
 
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