- One company in the U.S is working with crypto-rich clients and helping them get passports to tax havens to avoid BTC tax.
- The clients have a choice of 7 tax havens, but it doesn’t come cheap.
Two things are certain in life – death and taxes. And while death is inescapable, one company is helping its clients avoid the second certainty – taxes. The company, known as Plan B, sells passports to its clients, usually individuals who have made millions in crypto, to tax havens to avoid the hefty taxes in their own countries, mostly the U.S.
Plan B Passport offers just that, an alternative residence or citizenship to allow crypto millionaires to avoid taxes. It was founded by Katie Ananina, a 26-year-old Russian now living in the U.S. Katie is a Bitcoin maximalist who says she got into crypto after witnessing the Russian ruble crash by 50 percent in two months. Since then, she has had an issue with the financial system, and governance as well. This has been her motivation to help fellow Bitcoin investors avoid the hefty capital gains.
Katie believes that nobody should live in a country whose governance, policies and laws don’t suit them.
If the government starts affecting me, I will take all my assets into my hands and go elsewhere.
Also Read: A crypto tax trip through the largest countries in Europe
Avoid Bitcoin taxes – how it works
According to CNBC, every year, Katie helps hundreds of clients secure passports to tax havens. Clients have the choice of seven havens – Antigua and Barbuda, Vanuatu, Dominica, Portugal, Saint Lucia, Saint Kitts and Nevis and Grenada.
To secure these passports, Plan B works with citizenship-by-investment programs. These are especially popular in smaller economies that have fewer resources to exploit. Ernest Marais, an attorney with tax law firm Andersen explained:
It’s an attractive way to draw foreign investment and especially prominent in countries with few natural resources. In Saint Lucia you can obtain citizenship by an investment of between $100K (donation), $250K (government bonds) or $300K (real estate).
Saint Kitts is the most popular for families, with Saint Lucia being the most popular for single clients.
And while this is a relatively new niche, business is booming according to Katie.
“My only marketing channel is Twitter. I literally do not spend a single penny, but I’m booked out three weeks ahead on consultation calls,” she told CNBC.
In the U.S, the IRS categorizes Bitcoin as property. This means that it’s subject to the same taxes as real estate and stocks.
John Feldhammer, a tax expert, explained:
At a basic level, the taxpayer’s basis in the bitcoin is what the taxpayer purchased it for, and when the taxpayer sells or exchanges that bitcoin, it is a taxable transaction. The taxpayer’s income or loss is determined by taking the sales price and subtracting the taxpayer’s basis.
Avoiding taxes is legal in the U.S, unlike evading taxes which is a criminal offense. Nevertheless, Katie has faced animosity from authorities for years now. At airports, she’s detained for hours on end. But she says this can’t lessen her resolve to ensure Bitcoin millionaires avoid taxes.
Every time I cross the border, I get detained in the airport for three hours. They ask me a bunch of questions, and every piece of luggage goes through the craziest screening. They literally turn my socks inside out.
Credit: Source link
