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Citizens of Nowhere

 

The world was given a false impression that the trend of  "work from anywhere" started in 2020-2022. It certainly accelerated then and became more acceptable, however, predictions of this happening started many decades ago. I remember around 2017 asking a very wealthy client which place she called "home", where she truly lived and her response was, "In the air!"
 
There are a growing number of people who can conduct a big chunk - or all - of their work from anywhere. Some call them Digital Nomads. Some simply travel so much for work that they live in multiple parts of the globe at different times. The 2020-22 era was more an era of normalizing this trend. In reality, many people who live this lifestyle do so for a primary reason: tax avoidance or tax evasion. Relinquishing your residency or citizenship in one area can produce enormous tax savings. 
 
I know of a fella who left the UK to live in DUBAI specifically for tax reasons. He claimed it was for the sunnier weather, but often the reasons they do this is all about the money. I don't know of many people who find living in Monte Carlo the be-all and end-all of life. It's possibly one of the most densely built environments on earth, and in my humble opinion significantly less attractive than nearby Cap D'Antibes.
 
Yet its tax-free status overrides its citizens' desire for better aesthetics. I questioned a client of mine who bought a rather mediocre $75 million apartment in Monte Carlo and he explained that the purchase would pay for itself within 6 years with the tax savings. He loathes living in Monaco, but it allows him to keep significantly more of his earnings. This thinking is not exclusive to the rich.
 
The IRS considers you a U.S. resident if you were physically present in the U.S. on at least 31 days of the current year and 183 days during a three-year period. For those who move to areas they like but don't really love, chances are they'll travel lots or at least spend a notable amount of time in the areas they do love. They have the freedom to do so. And they reap the often sizable fiscal benefits of spending less time there. The wealthier they are, the greater chance they own multiple homes, although these days even wealthier nomads are becoming more comfortable renting furnished homes.
 
While Alaska, Nevada, Texas, Florida, North Dakota, Tennessee, New Hampshire, Washington and Wyoming lure Americans with no state taxes, they are finding competition: Puerto Rico has zero taxes! Portugal boomed off the back of the D7 visa, introduced in 2007 for passive-income earners. It is introducing a new digital nomad visa for non-EU citizens, as is Spain. Croatia, Greece and Malta all have them up and running.
 
Malaysia is attracting digital nomads particularly if you work in IT and digital content creation. Bermuda’s slogan is “Work from Bermuda”. Citizens of the Bahamas are not taxed on their individual income because of the high profits made from tourism. There are only capital gains taxes, capital transfer taxes, and estate taxes. Some countries have outstanding tax breaks for older foreigners, many of whom remain working - and earning - remotely. While many areas are 'dead right' about charging high local taxes as 'things' do indeed have to be funded, maybe it's time for them to become more competitive and practical!
 
AIRbnb has allowed many less wealthy global Nomads to prosper. The jury is out as to whether this lifestyle is good or bad for neighborhoods and communities or people. One thing's for certain: the communities who lose these nomads to other parts of the country and planet will all have to pay more to keep their local world moving, even more so if this group shields their income and assets in shell companies and offshore bank accounts. When that much money is removed from local 'systems', someone has to pay the difference: YOU!

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Ken interprets market data, staying in constant communication and offering valuable insight that then translates into an informed decision.

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