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June 7, 2011:

"Kathleen, a few months ago I read your article 'Strategies for a Tax Free Life.' I also listened to the audio tapes from your most recent Emergency Offshore Summit, hoping that they would contain the details for how an online company in the United States can move offshore. Alas...not all of my questions were answered...

"I'm planning to move to Panama this year. I have several existing online companies that cater to U.S. customers. Do I need to set up a company offshore to qualify for the FEIE?

"If I set up an offshore company, I'm sure I'll need a bank account in that country. But how about getting a merchant account? Won't my customers be charged an international fee every time they make a purchase? How can I avoid that?

"If I'm planning to live in Panama, wouldn't it make more sense to have my offshore company in a different jurisdiction? Where is best with the least hassle?"

--Jackie L., United States

International tax and business attorney Chris Rusch replies:

Yes, you will need to incorporate offshore to maximize the benefits of the Foreign Earned Income Exclusion. You can read more about this here.

And, yes, it may be better to incorporate in another jurisdiction. I recommend Nevis. As you'll be living and working in Panama, though, you might open a personal account in that country.

Many clients incorporate in both Nevis and Panama, if they wish to rent office space, have a corporate bank account, etc., in Panama.

You can reach Chris with more questions here.Continue Reading:

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June 7, 2011:

"Asunción is like Panama City 100 years ago but with a population of a million-and-a-half," writes a Panamanian friend in Panama City in response to my query regarding her recent trip to Paraguay.

"This country went from a military dictatorship to a dictatorship of a political party. There was almost no middle class. Just the rich and the poor. This changed just a couple of years ago, and a new era has come for the people of Paraguay with this new government.

"There is a lot of opportunity for investment, as there is a lot to be done. People are friendly and honest, and life is almost bucolic. The only thing that is expensive is taxis (there are not enough of them).

"When you visit, as I know you're planning to do as soon as you can, don't stay at the Club de Golf hotel. It is out of town in the countryside, and the taxi to the city costs US$18. Better to stay at the Crowne Plaza in the city..."Continue Reading:

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"So we set off on a home-seeking tour of Mexico, Panama, Costa Rica, and the United States. We were in search of a country that would check as many boxes as possible on our long wish list.

"After almost eight months of travel and change, we decided that some but not enough boxes had been checked off by each country we'd spent time in. Furthermore, thanks to our travels in Central America, we came to a slightly unexplainable realization: We wanted to return to Europe.

"But where in Europe? Not the UK (too easy; that's where I'm from), not Scandinavia (too cold and dark), not Italy, nearly Croatia...but, finally, France.

"I had been visiting France since I was a young teenager and had very happy memories of summer months there. I also have close family in the north and south of the country. Plus, I felt that this would be a safe, stable, and interesting place to raise our children.

"Are we happy with our decision? I can respond today, three years later, with a confident and enthusiastic yes.

"Has it been easy and hassle-free? No.

"La Belle France has worked her magic on us...but no place is perfect...including, certainly, France.

"Just six months after we settled into the southwest of this country, close to the city of Pau, I was inspired to write a short article about the good and the bad sides of life here. I called the article -- 'La Belle et La Bête' (Beauty and the Beast). Three years on, writing this today, I thought it would be interesting to see if those beasts I wrote about upon arrival in our new French home are still harassing me...or was it simply the beginner's shakiness that many expats experience after the first few months in a new place?

"Back in 2008 I wrote:

"'I am in a state of permanent surprise; some days it's joyous and other days it's disbelieving. Mostly it's joyous, but there are times when I would like to shake those gently shrugging Gallic shoulders...and say, smiling ever so sweetly, "Yes, it is possible! I'll show you, right now."'

"Today, as I write this, I'd still make that observation. It can be hugely frustrating trying to get anything accomplished in this country that requires a little thinking outside of the proverbial box. Sometimes so much so that I get the screaming heebie-jeebies and have to rush home and enjoy the fruits of those wonderful French vineyards!

"Whether to handshake or kiss, how to open a bank account, how to get the timing of your shopping right, how to dodge the strikes, learning to enjoy quiet Sundays, dealing with a higher cost of living, being careful to observe everyday politeness and etiquette, dealing with customer service (or disservice), learning French (again), managing my children's education...it all remains a balancing act but one where the scale tips more often toward La Belle than La Bête.

"In 2008, I finished my article with the following observation which, three years down the line, I'd like to share anew:

"'After a particularly long and complicated meeting with my bank manager, I stepped out onto the town square and into the middle of the farmers' market, bought some smelly cheese, a long crusty baguette, a bunch of home-grown Lily of the Valley, and then contemplated life as I sipped my café allongé...

"'There's always something to be savored...everywhere in France...'

"Deciding where in France to settle, invest, or live in part time is a tough choice. Not many countries have something to offer at each cardinal point, but I believe that France does. From Normandy to Provence and Alsace to the Basque Region there is culture and diversity to excite and thrill every taste..."

Kathleen PeddicordContinue Reading:

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March 15, 2011:

"I'm about to go to Panama for about 10 days, and one thing I'm planning to research is Panamanian banks. Specifically, I'm looking for one where I could hold gold and silver safely. Could you make any recommendations?"

--Chris W., United States

Over the past 12 years, we've had experience opening accounts and doing business with about a half-dozen banks in Panama. Each has its pluses and minuses. One thing to understand is that, in the current climate, it's not easy for an American to open a new account...neither personally not, especially, for a corporation. And any bank account in Panama must be opened in person...with a personal interview. We know of only one exception to this rule...a new bank that sometimes will waive the personal interview requirement, especially if the would-be new client comes with an introduction.

Which bank makes sense for you depends on what kind of account you're looking to open and for what purpose. An operating account? A private account? A corporate account? From where and how will the account be funded...and what kinds of funds will flow through it over time?

We don't really recommend any bank as a top choice for storing precious metals. Rather, consider a private vault or storage facility.Continue Reading:

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"Each region has its own flavor and culture, and some are much more interesting to the would-be expat or retiree than others...thanks to property prices, climate, culture, proximity to Paris, good transport connections, or maybe all of the above.

"Specifically, here are six unsung regions of this country that you may not have considered...but should:

#1 France Focus: Aquitaine--Population 3.15 million, area 15,949 square miles

Situated in southwestern France on the Atlantic coast, this is the fifth most visited region of France. It is hugely varied geographically, with mountains (the Pyrenees), plains, and coast, and home to wines of Bordeaux, Madiran, and Jurançon.

Specifically, in the Aquitaine, we recommend that you look at the Basque region and the Bearn (where my family and I have chosen to base ourselves).

#2 France Focus: Burgundy (Bourgogne)--Population 1.63 million; area 12,193.9 square miles

With its easy access to Paris (just one hour on the TGV train), Burgundy is one of our top hot-spots in this country, both as a place to base yourself and as a place to invest for rental yield.

Situated next to the Champagne region and the Région Parisienne, Burgundy is rich in history and boasts many striking towns and cities, including Dijon, Vézelay (a UNESCO-listed medieval village), and Decize (an island set in the middle of the River Loire).

Burgundy is famed for its wine, food (a Gastronomic Fair is staged in Dijon every year), and architecture (both Gothic and Renaissance). Until the late 18th century, Burgundy was not part of France; it was a self-governed Dukedom and long-time ally of English kings.

The region has a continental climate with mild to cold winters (and occasional snow) and hot summers. Autumn is particularly beautiful here, with crisp blue skies contrasting against the striking colors of the turning leaves. The slopes of the vineyards are called Côte d'Or for a reason. They are often sundrenched, as this region sees 1,830 hours of sunshine per year!

Wine is one of the pillars of Burgundy life, with some of the most famous wines in the world coming from its vineyards. Grapes were first introduced by the Romans, and production was mastered by the local monks.

#3 France Focus: Franche-Comté--Population 1.16 million; area 6,255.6 square miles

This region lies on the eastern side of France, bordering Switzerland. It is greatly influenced by its Alpine neighbor and shares similar architecture, food, and culture. This is an area of France that is much ignored by foreign home-buyers, which is odd as its landscape and climate make it perfect for both winter and summer living. It has good train connections with the center and the south of France, Switzerland, and Germany. Its proximity to Switzerland means that you could live here while working there. (France can be a much more affordable place to live than Switzerland.)

Property deals in this part of France can be good. For example, a renovated four-bedroom stone farmhouse with workshop, garden, barn, and garage was listed recently for 149,000 euro (about US$200,000).

#4 France Focus: Languedoc-Roussillon--Population 2.8 million; area 10,569.9 square miles

The region capital of Languedoc-Roussillon, Montpellier, is the fastest-growing city in France, with a population of 245,000. It is the home to France's oldest university and has recently been voted one of the best places to live in this country...if you like cities.

This is the "other" south of France, very Mediterranean and influenced by its proximity to Spain. It is hot and dry in the summer, wet in the winter, and cool and clear in the spring and fall and enjoys many days of sunshine each year.

This is a region of warm colors, sleepy villages, mountains, gorges with cascading rivers, endless vineyards, olive trees, colorful markets, the Canal du Midi, and the gentle waters of the Mediterranean coastline. It is also the land of the Cathars and boasts incredible historic sites, including Carcassonne.

#5 France Focus: Limousin--Population 727,000; area 6,541.3 square miles

Limousin is the second least-populated region of France, after Corsica. It is a rural region with little in the way of job opportunities. Just slightly west of center of the country, Limousin is also beautiful, with a unique landscape of woodlands, green pasture, and deep valleys. This is a quiet, romantic part of France that appeals to lovers of nature and wildlife and not to culture enthusiasts craving theaters, museums, and night life. Because of this, property prices are lower than many other regions.

This is where I would live (at least part of the year) if I didn't have children to raise who need a bit more excitement and stimulation.

Property prices can be mouth-watering. Recently listed for the equivalent of about US$185,000 was a partly restored character house built in 1832 with a mill and a former blacksmith's workshop, a 4,000-square-meter pond, and gardens. The top price category on the website of one of the main real estate agencies for this region is "More than €200,000." In many other regions of the country, property prices start at that level!

#6 France Focus: Poitou-Charentes--Population 1.73 million; area 9,964.9 square miles

Poitou-Charentes forms the central part of France's Atlantic coastal plain. It's quite flat except inland, where it becomes more undulating as the land rises toward the Massif Central. In the south are extensive vineyards, where grapes for Cognac and the aperitif Pineau des Charentes are grown.

This is another region that deserves more attention than it receives, thanks largely to its appealing climate, which is one of the mildest in France. The coastal area here is the second-sunniest in France, after the Mediterranean coastline.

If you are interested in restoring an old property or in buying a refurbished rural property, the three inland departments of this region, Charentes, Vienne, and Deux-Sevres, are definitely worth your attention. The renovation opportunities are many and available for as little as 50,000 euro.

Kathleen PeddicordContinue Reading:

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Kathleen Peddicord

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.

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