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So you want to retire in florida 1997 far
1. GREATER ORLANDO ASSOCIATION OF
REALTORS
Real Estate Law Symposium
Church Street Station, Orlando
Thursday, 16th
October, 1997
* * * * *
James LaVigne, Esquire of Orlando, Florida
“So you want to retire to Florida?”“So you want to retire to Florida?”
and Other Pre-Immigration Issuesand Other Pre-Immigration Issues
“The hiring of a lawyer is an important decision that should not be based solely on
advertisements. Before you decide, ask us to send you free written information about our
qualifications and experience.” The following outline is written to discuss general
considerations in the US immigration process. Each individual’s particular background
and circumstances are unique and must be considered and analyzed to evaluate the
most appropriate avenue for obtaining US immigration benefits for that individual.
2. I. Retirement Visa
A. H.R.225 is a bill to amend the Immigration & Nationality Act
1. Introduced by Congressman Bill McCollum (R-8th
FL)
2. Referred to Judiciary Committee 1/7/97
B. Would permit certain aliens who are at least 55 years of age to obtain a 4-
year nonimmigrant visitor’s visa
C. Approved list of countries able to participate (those currently in the visa
waiver program of entry)
D. Ownership of US residence (alien or spouse)
E. Not eligible for employment
F. Not eligible for any federal, state or local public benefits
G. Evidence of specific net worth and/or annual income (annual gross income
equal to or greater than twice the “poverty line”
H. Evidence of health insurance
II. B-1/B-2 Visa
A. Purpose – Visitor for business of pleasure
B. Requirements
1. Entry for limited time
2. Intent to return to home country
3. Foreign residence
4. Financial resources
5. Business or pleasure activities only
C. Duration of Stay
1. 6-12 month admission upon initial entry; 6 month extension
increments
2. B-1 business visitor admitted with period of entry necessary to
conduct business
3. B-2 pleasure visitor automatically admitted with period of entry of
six months
4. Period of visa validity of up to ten years
5. Unlimited number of entries depending on country of nationality
6. Employment not permitted
D. Visa Waiver Pilot Program
1. Permits nationals of certain countries admission as visitor without
B visas
2. Admission with period of entry of ninety days or less
3. No extension or change of status permitted
III. E Visa
A. Purpose
1. Direct and develop investment or
2. Conduct trade
B. Requirements
1. Existing treaty
2. Majority ownership or control
3. Nationality
4. Substantial trade principally between U.S. and treaty country
3. 5. Active, substantial investment creating jobs (non-marginal)
6. Managerial or essential skill capacity
C. Duration
1. Visas valid up to 5 years with multiple entries
2. One year status granted with initial entry
3. Status can be extended indefinitely in two year increments
IV. L Visa
A. Purpose – Transfer of manager or executive from foreign business to US
affiliate, branch or subsidiary
B. Benefit - Priority worker immigration category for permanent residence
C. Requirements
1. Employment abroad for one year within the past preceding three
years
2. Qualifying relationship between the foreign and US companies
3. Must be doing business in the United States and abroad during
period of transfer
4. Employee must be executive, manager or have specialized
knowledge in position abroad
5. Employee must be transferred to US company in executive,
managerial or specialized knowledge capacity
6. Employee must have prior qualifying education and experience
7. Intent to depart US at expiration of authorized stay but may
simultaneously pursue permanent residence
D. Duration
1. Start-up visa valid for one year
2. Status extension of up to three-year increments
3. Cap of 7 years
4. Permanent Residence possible
V. O Visa
A. Purpose – For aliens of extraordinary ability in the sciences, arts,
education, business or athletics
B. Requirements
1. Must be one of the small percentage who has risen to the top of
field of endeavor
2. Prominent, leading or well-known in the arts
C. Duration
1. Initial period of stay for time needed to finish event(s) or
activity(ies)
2. Extensions of status granted in one-year increments
VI. Employment-Based Permanent Residence
A. First Preference (40,000 annual visas)
1. Managers and executives internationally transferred
2. Outstanding professors and researchers
3. Aliens of extraordinary ability in the sciences, arts, education,
business and athletics (no sponsor required)
4. No labor certification required
4. B. Second Preference (40,000 annual visas)
1. Aliens of exceptional ability in the sciences, arts or business
2. Advanced degree professionals
3. No labor certification required if in the national interest
C. Third Preference (40,000 annual visas)
1. Professionals with bachelor’s degrees not qualifying as advanced
degree professionals in second preference
2. Skilled workers for positions requiring two years or more of
training and experience
3. Unskilled workers
4. Labor certification and offer of employment required. Must show
that there are no US workers available to fill the designated
position.
D. Fifth Preference (10,000 annual visas)
1. Alien investors in new commercial enterprises or troubled
businesses
2. Investment in targeted employment area or elsewhere
3. No labor certification required
4. Must invest or be actively in process of investing between
$500,000 to $1 million in the enterprise
5. Must benefit the U.S. economy and create full-time employment
for at least 10 US workers
6. Investor must be engaged in daily managerial control or through
policy formation
7. Permanent residence conditional for two years
VII. Family-Based Permanent Residence
A. Immediate relatives of U.S. citizens
1. Spouse
2. Children (unmarried and under 21 years of age)
3. Parents (if citizen is 21years of age or older)
4. Visa immediately available
B. Close family members of citizens or residents
1. Unmarried sons and daughters of citizens over 21years of age
2. Married sons and daughter of citizens
3. Spouses and unmarried sons and daughters of permanent resident
aliens
4. Brothers and sisters of citizens
5. Limited number of visas available so annual numerical cap and
therefore a waiting list
VIII. 1999 Diversity Immigrant Visa Program (DV-99)
A. Makes 55,000 permanent residence visas available each year to persons
meeting the eligibility requirements. Applicants are chosen through a
random computer-generated lottery drawing. Visas are apportioned
among six geographic regions with a greater number of visas going to
regions with lower rates of immigration and no visas going to countries
sending more than 50,000 immigrants to the U.S. in the past five years.
5. No one country can receive more than 3,850 diversity visas in any one
year.
B. Natives of Canada, China (mainland and Taiwan, except Hong Kong
S.A.R.), Colombia, Dominican Republic, El Salvador, India, Jamaica,
Mexico, Philippines, Poland, South Korea, United Kingdom (except
Northern Ireland) and its dependent territories and Vietnam ARE
INELIGIBLE.
C. Entries received by National Visa Center between Noon on Friday,
October 24, 1997 and Noon on Monday, November 24, 1997.
D. Requirements
1. Nativity in an eligible country
2. High school education or its equivalent or two years of work
experience within the past five years in an occupation requiring at
least two years of training or experience to perform
IX. Issues to be Examined in Determining US Immigration Benefits
A. Immigrant vs. Nonimmigrant Intent
B. Time Constraints
C. Economic Constraints
D. Alien’s Ability to Meet Legal Criteria for Specific Category
E. Tax Planning for US Investments and Acquisitions
1. Determine appropriate entity to obtain and maintain assets
2. Properly draft contracts & agreements
3. Tax ramifications of investment and acquisition
F. Estate Planning
1. Restructuring ownership of assets
2. Transferring assets to family members or trusts
X. Tax Planning
A. U.S. Resident vs. Nonresident Status
1. US resident taxed on worldwide income
2. Nonresidents taxed on US source income
3. Determining tax status
a. Residency test
b. Substantial presence test
(i) Exceptions
(a) Closer connection/tax home exception
(b) Exempt individuals: foreign government
related individual, teacher/trainee, student,
professional athlete competing temporarily
in US in charitable sports event
c. Tax treaties in effect with 45 countries; supercede tax code
B. Income Taxation of US Nonresident Aliens
1. US source investment income (30% rate)
a. Rental income (unless income is made to treat income as
effectively connected to conduct of US trade or business –
the net basis election)
b. Personal service income
6. c. Dividends (determined by corporation’s source of gross
income)
d. Capital gains (not subject to tax is nonresident alien does
not meet substantial presence test and net capital gains of
personal property are not effectively connected with US
trade or business)
e. 50% of social security payments and pension attributable to
services performed in US are taxed at 30% or lower treaty
rate
2. Income effectively connected with US trade or business (regular
graduated income tax rates)
3. Married nonresident alien couple can file joint tax return if the
nonresident alien is married to a US citizen; otherwise, must file as
married individuals filing a separate tax return
4. Minimizing taxes
a. Claim foreign tax credit for foreign taxes paid or accrued
on foreign source income
b. Deduct moving expenses
c. Deferred gain on sale of personal residence
d. Deduct employee business expenses
e. Foreign earned income exclusions
5. Interest from U.S. banks, savings and loans and insurance
companies and portfolio interest is excluded from US income tax
C. Consequences of Nonresident Not Filing US Income Tax Return
1. Gross rental income subject to 30% tax applicable to fixed and/or
determinable annual or periodic income
2. Taxpayer will be unable to accumulate losses to offset future
income or any gain on the sale of property
3. When filing back tax returns upon the eventual sale of property,
deductions and credits otherwise available will be denied for not
timely filing
D. US Real Property Sales by Nonresident
1. Net gain on sale is effectively connected income and will be
subject to graduated income tax rates
2. Buyer or transfer agent must withhold 10% of amount realized on
sale to be paid to the IRS no later than twenty days from day of
transfer
3. Withholding tax is allowed as a credit
4. Apply for withholding certificate prior to sale completion
E. Sales and Use Tax and Local Tourist Tax
1. Must register each individual short term rental home with the state
and obtain sales tax number
2. Short term rentals are subject to local tourist (resort) tax; must
obtain local account number from the county
F. Property Taxes
7. 1. Tangible property in rental home must be reported to county
property appraiser
2. Real estate taxes are due on the assessed value of the land and
house
G. Federal Employment Taxes
1. Wage withholding
2. 30% rate for services performed in US by self-employed
nonresident alien
3. Social Security Taxes (FICA)
4. Social Security (Totalization) Agreements
5. Reporting of Payments Made to Nonresident Aliens
H. US Taxation of Foreign Trusts and Foreign Beneficiaries of Domestic
Trusts
1. US law is designed to discourage US persons from transferring
appreciated assets out of US tax system or to shield from US
taxation current income from such trusts
2. Whether it is a foreign trust depends on under which country’s
laws it was created, the location of the trust’s assets, the nationality
and residence of the trustees, the location of the trust
administration, the nationality and residence of the trust grantor
and beneficiaries
3. US grantor of trust with US beneficiary is the trust owner and is
taxable on the income of the trust on a flow-through basis
4. Transfers of property to a foreign trust by US grantor may be
subject to gift tax, generation-skipping tax and excise tax of 35%
5. US beneficiary must include current distributions in gross income
to the extent of non-grantor foreign trust’s worldwide distributable
net income
6. Foreign beneficiary of a non-grantor trust is subject to US income
tax
I. US Estate and Gift Taxation of US Nonresident Aliens
1. Individual could be resident alien for income tax purposes but a
nonresident alien for estate tax purposes
2. Alien’s residence is place of domicile, home to which alien
ultimately intends to return
3. US situated property is subject to US estate tax with $60,000
exclusion
4. US – UK treaty allows credit for death taxes paid to UK with
respect to property taxed in US on basis of situs
5. US – UK treaty allows unlimited marital deduction for decedent’s
estate transfer of property to US citizen spouse (nonresident alien
couple may take advantage of qualified domestic trust)
6. Annual gift up to $10,000 per donee of cash or property is not
subject to gift tax; lifetime cap of $60,000 is given for US
nonresidents
J. Obtaining a US Identification Number
8. 1. Individual taxpayer identification number (Form W-7)
2. Available to those individuals required to have a US taxpayer
identification number but who do not have and are ineligible to
obtain a social security number