Cashing in, in a no tax state.

by Blexum Wed Jan 18, 2012 2:07 pm

If we go to Texas, Nevada, wyoming, Florida, etc. where they have no state tax to cash in post RV do we need to be a resident of that state or have had a bank account there for a minimum time period prior to cashing in? Are there any restrictions at all concerned with going to one of the tax free states to cash in?

by therealbutterfly Wed Jan 18, 2012 2:17 pm

You pay taxes based on where you reside. Unless its a corp, thats a diff tax situation.

by **Kevind53** Wed Jan 18, 2012 2:23 pm

Lot's of good info in some of the other chat sections, just nose around ... and as always, consult a competent tax lawyer.

by EddieB Wed Jan 18, 2012 2:25 pm

Correct states that have a state income tax will tax income in your residence state as income earned outside the state. When you file your federal income tax the information reported there say 1040 will be automatically reported to your state return where it will then be classified as either in state or out of state income. However, since you paid no tax in the local state you will be fully taxed in your state of residence.

The only way to avoid paying the state taxes is to legally change your residence before cashing in.

by Blexum Wed Jan 18, 2012 3:04 pm

So, I imagine a lot of people will be getting apartments in nevada before they do their LLC and trust there.

by 7freemom Wed Jan 18, 2012 3:08 pm

Could you not find a friend in non-tax state that will perhaps permit you temporary residency there for this purpose?

or
Create entity in non-tax state that you transfer all property to (prior to cash-in?

comments, perspectives welcome....

by therealbutterfly Wed Jan 18, 2012 3:21 pm

Blexum wrote:So, I imagine a lot of people will be getting apartments in nevada before they do their LLC and trust there.

You dont need to be a resident to form your trust or corp in Nevada...

by EddieB Wed Jan 18, 2012 4:40 pm

7freemom wrote:Could you not find a friend in non-tax state that will perhaps permit you temporary residency there for this purpose?

or
Create entity in non-tax state that you transfer all property to (prior to cash-in?

comments, perspectives welcome....

7freemom,

The temporary residence is a hugh red flag to the states that you currently pay taxes. In order to avoid the state residence you will need to file a "permenant" residence change.

As far as forming an entity Corporation or LLC where the income flows thru to your Federal return you WILL be taxed by your current state where you reside.

by **Kevind53** Wed Jan 18, 2012 4:43 pm

EddieB wrote:
7freemom wrote:Could you not find a friend in non-tax state that will perhaps permit you temporary residency there for this purpose?

or
Create entity in non-tax state that you transfer all property to (prior to cash-in?

comments, perspectives welcome....

7freemom,

The temporary residence is a hugh red flag to the states that you currently pay taxes. In order to avoid the state residence you will need to file a "permenant" residence change.

As far as forming an entity Corporation or LLC where the income flows thru to your Federal return you WILL be taxed by your current state where you reside.

Correct, but as understand it only on the amount that flows from the entity to you. Lower tax bracket = lower taxes as a percentage, you save money.

by 7freemom Sun Jan 22, 2012 10:55 am

Cashing in , in a "non-taxpayer" state of mind in relation to IRS, which can be created with your enlightened knowledge and wisdom empowered by those who would assist in "setting you free".

The Truth can set you FREE... if you LEARN, BELIEVE, COMPREHEND, and ACT thereupon... http://supremelaw.org/fedzone11/htm

Heard a recent talkshoe by this gentleman on many pertinent subjects including the truth about the IRS and how one might lawfully eliminate "taxpayer" status from one's life-- Would that make a difference both now and after RV to you?! I encourage you to check it out for yourselves!!

by 7freemom Sun Jan 22, 2012 11:03 am

oops

Forgot to give you the link to listen to by author of book referenced above

Here it is: http://recordings.talkshoe.com/TC-39904/TS-577579.mp3

The IRS portion begins at 2:14 to save you time and get to that particular point, but the entire program as AMAZINGLY ENLIGHTENING....

Blessings to all here seeking Truth, Abundance and much More... in His Love, 7freemom Very Happy

by Guest Sun Jan 22, 2012 11:09 am

If you do this at the last minute you will not achive the goal sought. The only way to acheive that goal is through as LLC with S corporation election or a trust situated in one of those states, with bank accounts there as well. You must operate it as business or the entity will be considered a shell, then the income will be brought back to your person and taxed the same with penalties and interest from both your taxed state as well as the fed. AJ

Blexum wrote:If we go to Texas, Nevada, wyoming, Florida, etc. where they have no state tax to cash in post RV do we need to be a resident of that state or have had a bank account there for a minimum time period prior to cashing in? Are there any restrictions at all concerned with going to one of the tax free states to cash in?

by **dinarstar** Sun Jan 22, 2012 12:16 pm

Blexum wrote:So, I imagine a lot of people will be getting apartments in nevada before they do their LLC and trust there.

Blex,with the low low lowwwww price of property here in Vegas today,I am thinking that many of the Oom family could very easily afford to buy an apartment(or two! Smile

) in order to assist with NV residence status Very Happy

by highdollarfolks Sun Jan 22, 2012 1:13 pm

Again, Listen to AJ. if you consult a tax professional or read the regs. You would have to establish residency in the NON-Tax state for 6 months to a year prior to that being a valid residence to count for your non-tax status. UNLESS, you are a business and possibly a Business Trust or LLC. HOwever the paperwork necessary to keep the income straight to avoid double tax is not simple. I am not saying getting the trust or LLC is not simple , but the book keeping to keep it all straight and keep it from flowing back to you as an individual. There are options to having a "residence" in a non-tax state. If you want to consider a business trust then get with Jim Jenkins that Okie and folks use. Especially to avoid inheritance tax. Do NOT set yourself up for a audit by thinking this is as simple as buying something and or driving to a non-tax state to cash in. Remember, once you have paid the state and federal tax on your new wealth you are DONE with taxes on that amount. YOu then only have to declare and pay on the New income your investments would make. Hope this helps. I worked for IRS many years. In Collection! OUCH!

by EddieB Sun Jan 22, 2012 1:38 pm

highdollarfolks wrote:Again, Listen to AJ. if you consult a tax professional or read the regs. You would have to establish residency in the NON-Tax state for 6 months to a year prior to that being a valid residence to count for your non-tax status. UNLESS, you are a business and possibly a Business Trust or LLC. HOwever the paperwork necessary to keep the income straight to avoid double tax is not simple. I am not saying getting the trust or LLC is not simple , but the book keeping to keep it all straight and keep it from flowing back to you as an individual. There are options to having a "residence" in a non-tax state. If you want to consider a business trust then get with Jim Jenkins that Okie and folks use. Especially to avoid inheritance tax. Do NOT set yourself up for a audit by thinking this is as simple as buying something and or driving to a non-tax state to cash in. Remember, once you have paid the state and federal tax on your new wealth you are DONE with taxes on that amount. YOu then only have to declare and pay on the New income your investments would make. Hope this helps. I worked for IRS many years. In Collection! OUCH!

Sorry but the 6 months you are talking about is total BS. You can achieve it in a few days in Florida starting with filing a domicile of residence notarized document, renting an apartment, and about 10 other things all outlined in the booklet Florida Residency Guide that goes to great length as I posted earlier in this article. As a practicisng tax professional, I know that for example in 2012 return you would then file a partial year resident return and the cash in would be sourced as Florida income not the taxable state you are filing the partial year return. It is critical that you follow all the items listed in the guide. But in todays electronic times this can ALL be accomplished in a few days.

For example, getting an apartment lease minimum 1 year, changing DL & Car Registration, changing bank addresses, changing credit card addresses, utility bills.

Note this is a legitimate change of address not a sham to just avoid state taxes. I plan to call Florida my home and have vacation spots in taxable states.:cheers:

Cashing in, in a no tax state.

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