Romney says he pays about 15 percent in income tax

[Homeslice]

I certainly hope people with offshore accounts are using them to invest in stock or real estate rather than just parking it in a savings account, because the weak-ass returns wouldn't be worth it the risk.

[Papa_Complex]

Originally Posted by Homeslice

I certainly hope people with offshore accounts are using them to invest in stock or real estate rather than just parking it in a savings account, because the weak-ass returns wouldn't be worth it the risk.

Every dollar not paid in income tax is a dollar earned.

[Homeslice]

Originally Posted by Papa_Complex

Every dollar not paid in income tax is a dollar earned.

But if the investment is just a CD only paying 2% APR, it isn't worth it.

What is the top tax braket, 38% or something? So a 2% CD here in America would net you about 1.2% instead of 2%. Not something worth crying about, unless you are talking about several million dollars in that CD. And parking that much in a CD is dumb, IMO. It should be in stocks, bonds, or real estate. Hell, you could easily average 2-5% a year in tax-free municipal bond funds here in the US.

[Papa_Complex]

Originally Posted by Homeslice

But if the investment is just a CD only paying 2% APR, it isn't worth it.

What is the top tax braket, 38% or something? So a 2% CD here in America would net you about 1.2% instead of 2%. Not something worth crying about, unless you are talking about several million dollars in that CD. And parking that much in a CD is dumb, IMO. It should be in stocks, bonds, or real estate. Hell, you could easily average 2-5% a year in tax-free municipal bond funds here in the US.

You miss my point. By being held offshore, it's already yielding 38%.

[Homeslice]

Originally Posted by Papa_Complex

You miss my point. By being held offshore, it's already yielding 38%.

On the return. Not the principal.

If the offshore account earns 2%, he's earning 2% instead of the 2% - (2% * 0.38) he'd earn in the US.

Which means 2% instead of 1.2%.

[Papa_Complex]

Originally Posted by Homeslice

On the return. Not the principal.

If the offshore account earns 2%, he's earning 2% instead of the 2% - (2% * 0.38) he'd earn in the US.

Which means 2% instead of 1.2%.

If it's offshore and he isn't declaring, which is kinda the point of housing funds offshore, then his principle isn't being reduced by 38%. Whatever it earns, after that, is a tiny fraction of the real benefit.

That's the point.

If you put $1,000,000.00 in an offshore account, then it's immediately worth $380,000.00 more than a million dollars that you kept in the US.

[Homeslice]

Originally Posted by Papa_Complex

If you put $1,000,000.00 in an offshore account, then it's immediately worth $380,000.00 more than a million dollars that you kept in the US.

Not sure how you're coming up with that.

Unless his employer paid him under the table, that $1,000,000 is after-tax money. It isn't going to be taxed again. Only the return he makes on it will be taxed.