How to Gain Tax-Free Access to the USA

Nomad Capitalist R&D

26 Oct 202416:04

Summary

TLDRThis video explores the options available for global entrepreneurs seeking to access the US market without needing a green card or US citizenship. It highlights the E2 non-immigrant investor visa, which allows non-resident aliens to invest in and operate businesses in the US while enjoying benefits like obtaining a Social Security number. The discussion emphasizes that investing in the US remains viable and that E2 visa holders can avoid exit taxes. Ultimately, it presents a strategic pathway for those looking to grow their investments in the US while minimizing tax obligations.

Takeaways

😀 You do not need a US green card or citizenship to invest in the US market.
😀 The E2 non-immigrant investor visa allows non-residents to access US banking and investment opportunities.
😀 Holding an E2 visa means you are not considered a permanent resident for tax purposes unless you meet the substantial presence test.
😀 The substantial presence test calculates your residency based on your physical presence in the US over the last three years.
😀 E2 visa holders can apply for a Social Security number and work for their own business in the US.
😀 Unlike green card holders, E2 visa holders do not face exit taxes when leaving the US.
😀 A substantial investment (typically around $100,000 to $120,000) is required to qualify for the E2 visa, which should sustain a legitimate business.
😀 Not all nationalities are eligible for the E2 visa; eligibility depends on citizenship from countries with treaties with the US.
😀 E2 visa holders are subject to US taxes only on US-source income, not on global income.
😀 The E2 visa provides a pathway to explore business opportunities in the US without full integration into the US tax system.

Q & A

Do I need a U.S. green card or citizenship to invest in the U.S. market?
-No, you do not need a U.S. green card or citizenship to access U.S. banking, credit, or investments.
What is the E2 non-immigrant investor visa?
-The E2 visa allows non-immigrants to invest in and operate a business in the U.S. without being considered permanent residents for tax purposes.
How does the substantial presence test determine U.S. tax residency?
-The test calculates your average stay in the U.S. over the past three years based on a formula involving the number of days spent each year.
What are the advantages of the E2 visa compared to a tourist visa?
-E2 visa holders can obtain a Social Security Number and legally work in their U.S. business, whereas B1/B2 visa holders cannot.
What are the typical investment amounts required for the E2 visa?
-While there is no set amount, investments generally range from $100,000 to $120,000, depending on the business type.
Can E2 visa holders exit the U.S. without incurring exit taxes?
-Yes, E2 visa holders can exit the U.S. without facing exit taxes, unlike green card holders or U.S. citizens.
What type of businesses can qualify for the E2 visa?
-The E2 visa can qualify a wide range of businesses, from large operations like auto factories to smaller enterprises like food trucks.
Are all nationalities eligible for the E2 visa?
-No, only citizens of countries with specific treaties with the U.S. are eligible to apply for the E2 visa.
What is the tax obligation of an E2 visa holder?
-E2 visa holders are subject to U.S. taxes only on U.S. source income, allowing them to avoid global taxation.
What does it mean to be domiciled in a country for E2 visa eligibility?
-Domicile refers to having a center of vital interests in a country, which can include factors like home ownership and social ties.