Time For A Second Passport?

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You may never have considered it, but you do have a right to become a citizen of more than one country – and doing so could change your life for the better.

Under U.S. law, upheld by several U.S. Supreme Court decisions, holding a second citizenship does not jeopardize U.S. citizenship. In fact, the U.S. government isn’t interested in revoking any American’s U.S. citizenship. As long as an American holds his blue passport with the gold eagle on the cover, he retains his U.S. tax obligation, no matter where in the world he roams. Certainly, Uncle Sam isn’t interested in interfering with that.

While it’s impossible to know exactly how many Americans have acquired another passport, Professor Stanley Renshon of City University of New York puts the number of U.S. citizens who either hold or who are entitled to hold a second passport at about 40 million of the 312 million Americans.

But why would any U.S. citizen need to acquire a second nationality and the additional passport that goes with that expanded political status?

Safer travel, easier travel, less costly travel, safe haven, easier access to foreign banking, increased access to foreign investment options, expanded business opportunities…the advantages of carrying a second passport can be many.

Traveling on a U.S., U.K., or even a Canadian passport can make you a potential target in some parts of the world, mostly in Africa and the Middle East, but elsewhere, as well. Citizens from the Anglophone world have been targeted in the past by terrorists and opportunists. Being able to travel on a less high-profile passport can help keep you out of harm’s way.

Also, if you’re an American, the harsh current reality is that many banks around the world don’t want to do business with you any longer. It’s simply too much hassle thanks to the HIRE Act. If your only passport is from the United States, you can have a problem.

Increasingly, the U.S. government imposes highly burdensome restrictions on the freedoms that the nation’s founders set down in the U.S. Constitution. For people of wealth, in particular, there is now an extensive web cast to catch persons “the government” decides may be doing something wrong. And the current definition of “wrong” is so expansive as to be all-inclusive in the bureaucratic mind.

For example, the very fact that one has an offshore bank account, creates an offshore trust, or owns shares in an international business corporation – any and all of these innocent financial choices can suggest potential tax evasion in the jaundiced eyes of the IRS. It is not an exaggeration to state that the current IRS attitude is that any American with offshore financial activity is presumed to be engaged in tax evasion.

An alternative citizenship is, therefore, increasingly important as a powerful personal tool for truly international tax planning and investing. As a national of two different countries, you also can enjoy an extra degree of privacy in your banking and investment activities.

A second passport can be your key to a whole new world of freer movement, expanded international investment, and greater financial flexibility. You’ll have a second “home” to return to should things take a turn for the worse wherever elsewhere you’re residing. You’ll have an escape hatch of sorts.

So how does one become a citizen of another country if you don’t qualify for it by right of birth (or ancestry, as is possible with some European countries, including Ireland)? You have to put in the time. That is, you have to be a legal resident of the country long enough to qualify for naturalization. Most countries require five years of legal residency before you’re eligible to apply for citizenship. The residency requirement can be as little as two or three years if you’re married to a national of the country or if, in the case of the Dominican Republic, you invest in a business in the country. Andorra requires 20 years of legal residency.

Economic Citizenship – The Quickest Route to a Second Passport

What do we mean by economic citizenship? Put simply, it’s a passive, one-time investment or contribution leading to a second citizenship and passport.

Invest In Real Estate or A Business And Get A Second Passport

That’s the straightforward premise behind the economic citizenship program that the two-island nation of St. Kitts and Nevis has put together. Antigua has also recently opened their doors to this option for economic citizenship.

Of course, for most people who might consider this, the investment return is secondary to the second citizenship and the second passport.

Feeling Less Charitable?

The Commonwealth of Dominica (not to be confused with the Dominican Republic) is the other Caribbean country that offers economic citizenship.

Unlike St. Kitts, Dominica does not provide a real estate investment option, or, for that matter, any investment options leading to citizenship. Rather, a non-refundable, cash contribution to the government will get you what you want. The government calls this a “donation,” but being charitable is not the goal. You’re buying a second citizenship and passport. (To be fair, the government claims to use the funds generated by the program will be used to build schools, renovate the hospital, build a national sports stadium, and “promote the offshore sector.”)

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