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Capital gains are due at disposition. If Bezos leaves America then he only owes the value accrued during his time in America. Any more than that there's no basi
by arcticbull 3y ago
Capital gains are due at disposition. If Bezos leaves America then he only owes the value accrued during his time in America. Any more than that there's no basis for whatsoever. If he wants to rule Amazon from the Bahamas and not spend enough days in the US each year to pass the substantial presence test, then go for it.
If Bezos paid up when he relinquished residency and then Amazon went down, should he get a refund? 10 years later? Why not - why should he only owe money if it goes up?
He can do the same exact thing by renouncing his citizenship today and paying the capital gains due, today. It's not a 'loophole' that doesn't already exist. In fact, that's exactly what Eduardo Saverin did. [1]
[1] https://www.reuters.com/article/us-facebook-taxes-idUSBRE84G11A20120517 https://www.reuters.com/article/us-facebook-taxes-idUSBRE84G...
- Retric 3y ago> If Bezos leaves America then he only owes the value accrued during his time in America. That’s equivalent to what the IRS is doing only moving things forward to residency vs citizenship. The current system is actually better for Bezos or other multi billionaires because they can move anywhere around the world and keep deferring capital gains until death when it disappears.
- arcticbull 3y agoIndeed but worse for all the accidental Americans, expats, and lord help you if you want to start a business while living abroad.
- Retric 3y agoFair enough. Though this is a serious edge case. 2k people renounced American citizenship in 2019 some years it’s ~10k but only a fraction have any kind of meaningful capital gains liability. The general cases is Americans who get to defer liability not expats with a surprising bill.
- arcticbull 3y agoHey thanks for talking through this. Appreciate your perspective.