so many issues for US expats ... would forming an investing LLC in the US help?

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Marseille07
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Joined: Fri Nov 06, 2020 1:41 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by Marseille07 »

What are you talking about. I literally said "You're right that US-based credit cards would have to have some activities to avoid closures." and you respond with "So, you need to keep your US credit cards." I don't understand what you thought I was implying. No one said or implied to go ahead and close US accounts.
crswvc
Posts: 89
Joined: Sat Oct 05, 2013 12:27 am

Re: llc

Post by crswvc »

Sounds like a ”family office” type of company.
Perhaps you would be a fit for a virtual private family office.
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galeno
Posts: 2310
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Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by galeno »

If you are not a "US person" (citizen, legal resident, or illegal alien LIVING in the USA) my advice and many others on non-USA Bogleheads would tell you to stay away from the USA.

By its laws it's obvious that the USA does NOT like non-US investors who invest in financial assets. Bank accounts, US treasuries, and RE are OK. But not stocks and bonds.
KISS & STC.
SecondLifeExplorer
Posts: 3
Joined: Wed May 12, 2021 11:12 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by SecondLifeExplorer »

I have not seen any answers regarding whether someone has investigated the original inquiry's solution. I have recently spoken to several brokers, including both Vanguard and Schwab and neither will hold assets unless one has a domestic physical address. In the case of Vanguard, one simply cannot be a non-resident of the U.S....period. For Schwab, one can live overseas but must maintain a U.S. residence. Of course, I did not tell either of these who I was for all the reasons already discussed. However, because some of my assets are incredibly difficult to move, I really do not want to take a chance of moving my assets only to have a problem arise while I'm overseas and need to find a way to move them again. I have heard stories even of accounts being closed on expats while they were away and a check sent. Citibank does currently allow one to have accounts without a U.S. residence, but given all I've heard, I am hesitant to have all my assets in one brokerage. Sooo...with all that said, has anyone looked into moving their assets into an LLC as a potential solution? Did I miss the actual answer to that question?
typical.investor
Posts: 2730
Joined: Mon Jun 11, 2018 3:17 am

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by typical.investor »

SecondLifeExplorer wrote: Wed May 12, 2021 11:22 pm I have not seen any answers regarding whether someone has investigated the original inquiry's solution. I have recently spoken to several brokers, including both Vanguard and Schwab and neither will hold assets unless one has a domestic physical address. In the case of Vanguard, one simply cannot be a non-resident of the U.S....period. For Schwab, one can live overseas but must maintain a U.S. residence. Of course, I did not tell either of these who I was for all the reasons already discussed. However, because some of my assets are incredibly difficult to move, I really do not want to take a chance of moving my assets only to have a problem arise while I'm overseas and need to find a way to move them again. I have heard stories even of accounts being closed on expats while they were away and a check sent. Citibank does currently allow one to have accounts without a U.S. residence, but given all I've heard, I am hesitant to have all my assets in one brokerage. Sooo...with all that said, has anyone looked into moving their assets into an LLC as a potential solution? Did I miss the actual answer to that question?
Yes I answered...

Nolo seems able to set one up for $99 + state fees. A US address is required. If you have a US address, why not simply open a brokerage account at that address. If you don't have a US address, you could use a registered agent at $49 or so per year.

Not 100% sure on taxation, but I believe income will "pass through" to your personal tax return unless you incorporate.

And I will add... States have various filing requirements which will add to the cost. This is just much more complicated than using a brokerage like Schwab International )which I think you didn’t try because there is no requirement to have a US address ... of course it depends on your country of residence).

I stopped considering it as I wasn’t sure how LLC income would get taxed in my country of residence. There’s no tax documentation in English so here comes another expense.

If Schwab International or Interactive Brokers can’t help me, that’s my next step though. As of now, I personally am ok.
SecondLifeExplorer
Posts: 3
Joined: Wed May 12, 2021 11:12 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by SecondLifeExplorer »

Actually, Schwab International told me they required a physical address, as I thought I mentioned. I will make a third pass with them (I've spoken with two reps) in case there is some sort of disconnect in the information I'm receiving. I do not have a U.S. address that I will be keep when I go back overseas and my friends/family are all in CA. I do not want to open that can of worms :-). I will look further into the registered agent option. Sorry. I do not know much about that, as it pertains to personal finances as opposed to a business. I also have a couple investments that are very hard to move, so this is kind of nightmare and I don't want to ever have to do it again. I'll be curious if you're able to do it with Schwab.
SecondLifeExplorer
Posts: 3
Joined: Wed May 12, 2021 11:12 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by SecondLifeExplorer »

btw, that's a good point about the country of residence potentially taxing the LLC revenue differently than the U.S. does :-(
typical.investor
Posts: 2730
Joined: Mon Jun 11, 2018 3:17 am

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by typical.investor »

SecondLifeExplorer wrote: Thu May 13, 2021 10:43 pm Actually, Schwab International told me they required a physical address, as I thought I mentioned. I will make a third pass with them (I've spoken with two reps) in case there is some sort of disconnect in the information I'm receiving. I do not have a U.S. address that I will be keep when I go back overseas and my friends/family are all in CA. I do not want to open that can of worms :-). I will look further into the registered agent option. Sorry. I do not know much about that, as it pertains to personal finances as opposed to a business. I also have a couple investments that are very hard to move, so this is kind of nightmare and I don't want to ever have to do it again. I'll be curious if you're able to do it with Schwab.
Aaah, yeah Schwab International does require a physical address but it can be your foreign address. That’s what I used to open my account.

You don’t need a US physical address to do so.

I expect no trouble moving assets out of Schwab International as long as I have someplace (another US broker) to move them too. But I only hold US ETFs, some TIPS and brokered CDs.
sfnerd
Posts: 264
Joined: Tue Apr 08, 2014 1:16 am

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by sfnerd »

cbeck wrote: Sun Jan 03, 2021 6:59 am
Marseille07 wrote: Sun Jan 03, 2021 12:34 am
cbeck wrote: Sat Jan 02, 2021 11:54 pm
Marseille07 wrote: Sat Jan 02, 2021 5:59 pm
cbeck wrote: Sat Jan 02, 2021 5:52 pm I don't think you could open a new bank account claiming a hotel as your legal residence. The last time I opened a bank account I had to send a utility bill with my name and address to verify my US residence. But it's up to the bank or brokerage to decide whether you qualify as a US resident or not.
Yeah, I don't intend to open new accounts but here is the problem. If / when financial institutions demand proof of residence for whatever reason, your hotel bill might not be the strongest evidence for verification.
So, it goes without saying that you have to load yourself up with multiple brokerage accounts, bank accounts, and US credit cards before expatting, because you cannot count on being able to open any of those once you have left. Two of each I would say, at least, and four or five credit cards, that don't charge a foreign exchange fee. Then you have to make sure there is activity on each one of those accounts all the time so they don't close it on you. I was able to get a credit card from Capital One after expatting. I was also able to open an account at the only bank or credit union that I am aware is willing to open an account for an expat, State Department Federal Credit Union. SDFCU is now my preferred bank.
My approach would be somewhat different in that I would intend to open a bank account and possibly get a domestic credit card abroad denominated by their local currency. You're right that US-based credit cards would have to have some activities to avoid closures.

Technically speaking, CC and a checking account offered by the same institution can detect someone being abroad; though I'm not sure if anyone ran into issues of this nature.
More bad ideas. Credit cards in many foreign countries are not comparable to US credit cards. Here in Thailand, for example, credit cards do not have any fraud protection. You are on the hook for all charges unless the bank agrees to waive a charge at their discretion. There are no "rewards" on Thai credit cards, as far as I am aware, but I don't have one, because I would never be willing to assume the fraud risk. So, you need to keep your US credit cards.

Of course, you will need a local bank account, but you will also need US bank accounts to pay your US credit card bills, your US income tax or receive a refund, receive your SS benefits in the future, etc. And you need more than one US bank, credit card, brokerage firm, etc., because they can close your account at any time. When you expat it is like going into the desert where you have to bring all the water you will need for the rest of your life, except that in this case we're talking about financial services, not water.

You don't know enough about your future needs as an expat to be making decisions. You should find a forum with US expats living in the country you are thinking of moving to and find out what problems they are facing.
Just one correction: there are many Thai credit cards with fraud protection and rewards. I have one by Citibank, and there are quite a few from other banks. However I agree that it's a really good idea to have two of everything in the US before you go abroad.
Marseille07
Posts: 4001
Joined: Fri Nov 06, 2020 1:41 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by Marseille07 »

SecondLifeExplorer wrote: Wed May 12, 2021 11:22 pm I have not seen any answers regarding whether someone has investigated the original inquiry's solution. I have recently spoken to several brokers, including both Vanguard and Schwab and neither will hold assets unless one has a domestic physical address. In the case of Vanguard, one simply cannot be a non-resident of the U.S....period. For Schwab, one can live overseas but must maintain a U.S. residence. Of course, I did not tell either of these who I was for all the reasons already discussed. However, because some of my assets are incredibly difficult to move, I really do not want to take a chance of moving my assets only to have a problem arise while I'm overseas and need to find a way to move them again. I have heard stories even of accounts being closed on expats while they were away and a check sent. Citibank does currently allow one to have accounts without a U.S. residence, but given all I've heard, I am hesitant to have all my assets in one brokerage. Sooo...with all that said, has anyone looked into moving their assets into an LLC as a potential solution? Did I miss the actual answer to that question?
I don't think you missed it, but there was someone on a different thread talking about having an LLC in the US. The trick is, this person has a family member in the US and presumably using their address. If you don't have such an option then I'm not sure what can be done.
typical.investor
Posts: 2730
Joined: Mon Jun 11, 2018 3:17 am

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by typical.investor »

Marseille07 wrote: Fri May 14, 2021 1:01 am
SecondLifeExplorer wrote: Wed May 12, 2021 11:22 pm I have not seen any answers regarding whether someone has investigated the original inquiry's solution. I have recently spoken to several brokers, including both Vanguard and Schwab and neither will hold assets unless one has a domestic physical address. In the case of Vanguard, one simply cannot be a non-resident of the U.S....period. For Schwab, one can live overseas but must maintain a U.S. residence. Of course, I did not tell either of these who I was for all the reasons already discussed. However, because some of my assets are incredibly difficult to move, I really do not want to take a chance of moving my assets only to have a problem arise while I'm overseas and need to find a way to move them again. I have heard stories even of accounts being closed on expats while they were away and a check sent. Citibank does currently allow one to have accounts without a U.S. residence, but given all I've heard, I am hesitant to have all my assets in one brokerage. Sooo...with all that said, has anyone looked into moving their assets into an LLC as a potential solution? Did I miss the actual answer to that question?
I don't think you missed it, but there was someone on a different thread talking about having an LLC in the US. The trick is, this person has a family member in the US and presumably using their address. If you don't have such an option then I'm not sure what can be done.
I believe you can rent an address and use a “registered agent” to answer questions on behalf of your LLC.

But in addition to those two costs, there are also State filing fees (perhaps yearly).

I don’t believe you’d need a family member with such an address. And again, if you can use your family’s address, why would you go to the trouble of forming an LLC? Just open a normal brokerage account if your goal is to simply invest. Most invest without forming an LLC because it’s easier and cheaper.
Marseille07
Posts: 4001
Joined: Fri Nov 06, 2020 1:41 pm

Re: so many issues for US expats ... would forming an investing LLC in the US help?

Post by Marseille07 »

typical.investor wrote: Fri May 14, 2021 1:08 am
Marseille07 wrote: Fri May 14, 2021 1:01 am
SecondLifeExplorer wrote: Wed May 12, 2021 11:22 pm I have not seen any answers regarding whether someone has investigated the original inquiry's solution. I have recently spoken to several brokers, including both Vanguard and Schwab and neither will hold assets unless one has a domestic physical address. In the case of Vanguard, one simply cannot be a non-resident of the U.S....period. For Schwab, one can live overseas but must maintain a U.S. residence. Of course, I did not tell either of these who I was for all the reasons already discussed. However, because some of my assets are incredibly difficult to move, I really do not want to take a chance of moving my assets only to have a problem arise while I'm overseas and need to find a way to move them again. I have heard stories even of accounts being closed on expats while they were away and a check sent. Citibank does currently allow one to have accounts without a U.S. residence, but given all I've heard, I am hesitant to have all my assets in one brokerage. Sooo...with all that said, has anyone looked into moving their assets into an LLC as a potential solution? Did I miss the actual answer to that question?
I don't think you missed it, but there was someone on a different thread talking about having an LLC in the US. The trick is, this person has a family member in the US and presumably using their address. If you don't have such an option then I'm not sure what can be done.
I believe you can rent an address and use a “registered agent” to answer questions on behalf of your LLC.

But in addition to those two costs, there are also State filing fees (perhaps yearly).

I don’t believe you’d need a family member with such an address. And again, if you can use your family’s address, why would you go to the trouble of forming an LLC? Just open a normal brokerage account if your goal is to simply invest. Most invest without forming an LLC because it’s easier and cheaper.
I just found the post I was referring to. Not sure if it makes a difference in this context but it was an S-corp, not an LLC: viewtopic.php?p=5864597#p5864597

How do you "rent an address" though? Unless you're talking about something like PMB, I'm not aware of services letting you use their street address. I know realtors & property managers might, but I wouldn't consider these options being readily available.
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