1. It is common knowledge that the wealthiest individuals are mostly in the United States. Whether it is Bill Gates or Warren Buffett, or even Madonna and Michael Jackson, do they not want to avoid high taxes? If they feel overwhelmed, would it not be easy for them to change their nationality? Is it that the United States does not allow them to change? Or is it that no other country welcomes them? Of course not. The reason is simple - they feel it is unnecessary, or simply put, they do not pay high taxes! If you have closely followed Buffett's statements over the past year, you will understand - he admits that he pays less in taxes in a year than some of his employees. Why is that?
2. Did you know that China and the United States have signed a tax exemption agreement? (This is truly a good thing that the government has done for the people.) This treaty allows taxpayers from both countries to avoid double taxation and only pay the difference in tax rates between the two countries. In other words, when a Chinese citizen holding a U.S. green card (who is subject to global income tax under U.S. tax law) or an American citizen earning income in China pays income tax in China, they do not have to pay income tax again in the United States, but only pay the difference. However, the fact is that for most taxes, the tax rates in China are higher than those in the United States, so there is no difference to pay.
3. Did you know that personal income in the United States can also be deducted by expenses? Did you know that the U.S. taxes globally but is also globally deductible? Specifically, many expenses incurred worldwide (travel, accommodation, investment, donations) can be deducted from personal income. After all deductions, how much net income do you have left to be taxed?
4. Did you know that the tax rates in the United States are relatively low compared to other major countries in Europe and America? (Although they are higher than places like Hong Kong, which is not considered a country.) But do not compare it to high welfare countries like those in Northern Europe or Canada; even compared to France and Germany, the tax rates in the United States are much lower. Importantly, the average tax rate in the United States is lower than that in China.
5. Did you know that when you deposit money into your own and your family's life insurance (Rest Assured Insurance) (regardless of the amount), you do not have to pay taxes at all? Moreover, ultimately, this money returns entirely to you and your family for personal use!
6. Did you know that by entrusting your wealth to a trust company and combining it with life insurance, you can achieve intergenerational inheritance without being troubled by estate taxes? Did you know that there is no wealthy person in the United States who does not engage in such trust and planning?
7. Did you know that in the United States, whether you are a green card holder or a citizen, you can establish your own tax-exempt foundation at any time?
In other words, you can "donate" all your income for a year or even several years to this foundation to achieve the goal of paying zero income tax, but this money (as long as it is properly planned and designed) can still be used according to your wishes. Isn't the Gates Foundation a guarantee that Bill Gates' income is not taken by the U.S. tax authorities but used according to his wishes?
8. Did you know the most important point? All income and wealth you acquired before obtaining your green card (regardless of how many properties, how many mines, or how many billions in cash) are not subject to taxation as long as they do not generate net profits! Think about this, and you will realize that you actually have more wealth than all Americans, including Bill Gates and Warren Buffett, while paying less in taxes!
9. Finally, did you know that the United States is a country governed by law, and an important legal principle in this system is "he who asserts must prove"? This means that whether someone or the U.S. tax authorities accuse you of tax evasion, the law requires them, not you, to provide evidence; otherwise, the court cannot convict you!
Given the complexity of U.S. tax policies, it is advisable for everyone to understand U.S. tax policies before arriving in the United States. Only in this way can you avoid being troubled by tax issues in your future life in the United States. Of course, for many wealthy Chinese, mere understanding is not enough; property and tax planning are essential; otherwise, you will contribute significantly to U.S. taxes. I hope the above article is helpful to everyone.
