The Cross Border Living Blog

Possible US Visa Could Assist Cross-Border Retirement in the USA

A bill introduced in October may provide individuals who want to spend part of the year living in the United States with a special visa to do so.

The Visa Improvements to Stimulate International Tourism to the United States of America Act ("VISIT-USA Act") would provide a non-immigrant visa to an individual (and his or her spouse and children) who:

1. uses as least $500,000 in cash to purchase one or more residences;

2. maintains ownership of residential property in the United States worth at least $500,000 during the entire period the alien remains in the United States as a nonimmigrant; and

3. resides for more than 180 days per year in a residence in the United States that is worth at least $250,000.

Home buyers under this program, however, will be encouraged to pay a premium for their residence(es), as one of the proposed rules are that the residence must have sold for more than 100% of the "most recent appraised value of such residence, as determined by the property assessor in the city or county in which the residence is located".

If you are thinking that this proposal might assist you in an unofficially "permanent" relocation to the United States, it is important to note that for financial planning purposes, a visa-holder would not be able to receive government benefits such as Medicare, Medicaid, and Social Security. In addition,  the visa would not authorize the holder to engage in employment in the United States, except for employment related to management of the property, and the program would not lead to citizenship.

There is the question of how the visa holder would be taxed. Since this is technically an immigration bill, the income and estate tax implications of this proposed bill are not addressed. For planning purposes, as it stands right now, one could argue that once the Substantial Presence Test is triggered, the non-immigrant visa holder would be considered resident for income tax purposes, unless they can claim the Closer Connection Exception. Of course, one would need to seek advice from a qualified professional.

Today, on CNBC, however, Senator Charles Schumer implied that taxes would be paid on US source income: http://video.cnbc.com/gallery/?video=3000060614 

We will post updates to The Cross Border Living Blog as more information becomes available.

 

Budgeting Your Costa Rican Lifestyle

Cost of living expectations are one of the first things to check off your list when considering a cross-border lifestyle or a permanent relocation.

During the last several days I have had the pleasure of socializing with several couples, in their 30s, 40s, 50s and 60s, who are either temporary or permanent residents of the Central Valley or the Central Pacific Coast. They all agreed that getting a clear idea of their own expectations for their ideal lifestyle and applying numbers to the various expense categories from an ideal, and (and at the other end of the spectrum) minimally acceptable standpoint, greatly contributed to their successful relocation.

Start your own research with the information at this link: 

What is your own experience?

Cross Border Living and "Geo-Arbitrage"

I found an interesting article on "the location independent lifestyle" which apparently is being popularized by Tim Ferris' book, The 4-Hour Work Week. It also references three places to consider for your "geo-arbitrage". Happy Reading! http://financialhighway.com/the-location-independent-lifestyle-3-low-cost-but-amazing-places-in-the-world-to-live/

Ten Factors to Consider When Choosing a Destination For Your Overseas Retirement

More and more people are looking to the second half of their statistical lifetime as an opportunity to combine their talents and interests with their lifestyle and leisure goals. For many of this group, this opportunity may involve a permanent move into another country.

The most frequently asked question is also often the most difficult and time consuming question for people in this situation: "where should I/we retire"? This question is often closely followed by "how do I/we choose?"

The answer? You begin by identifying and organizing your priorities. Each jurisdiction offers its share of benefits and challenges. You need to weigh them against your list of priorities. The following list sets out 10 key issues to keep in mind as you create your list of priorities.

1. Immigration/Residency Requirements. Not all countries have open immigration policies. In many cases, you will need sponsorship from a close relative to be allowed permanent residency and/or citizenship.
2. Infrastructure. Not all countries have paved roads or high-speed internet.
3. Climate. No climate is absolutely perfect, but be sure you know what you are prepared to live with (or without).
4. Health Care. Consider availability, quality and cost.
5. Safety and Stability. I think this speaks for itself.
6. Culture. This is where the saying "When in Rome, Do As the Romans Do", comes to mind. Again, what is important here? Are you seeking the culture of your family heritage? How open are you to cultures radically different than your current location or upbringing?
7. Cost of Living. In some cases, cost of living ties into infrastructure, taxation and health care. In most cases, there will be tradeoffs. While paradise might come at a low cost of living, be sure you know what tradeoffs you need to be prepared to accept.
8. Cost of Real Estate. Although this also links into cost of living, be sure your research includes what is driving the cost of real estate in the jurisdiction and any impact that might have on your financial planning.
9. Family Matters. Consider proximity to family, heritage, health (current and future) of your parents, your spouse/partner and yourself, etc. If you have children or grandchildren whom you wish to see regularly, this factor may have a high priority for you and influence your decisions accordingly.
10. Taxation. Although taxation of income and assets (by countries where you have assets/income, the country of interest and in some cases your birth country) and other financial issues that may arise are very important, I suggest that they are best examined after you have made your quality of life decisions. For now, consider where this factor resides in your priority list.

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