After over two decades of representing hundreds of
Brazilians investment-based and
professional immigrants in the United States, I finally made it to Brazil. My
hasty January visit — more than anything a glimpse into the still-Napoleonic
tendencies demonstrated by the occasional US visa officer — left me with a
clear impression of Sao Paolo: a thriving metropolis as dynamic as its
population.
Today's Wall Street Journal (page A10) discusses how
Brazil's rapid economic recovery is starting to create concerns similar to
those the US has had with China: the overheating of what has turned into a
colossal industrial machine. The Journal predicts that Brazil's central bank
"is likely to start a series of interest rate increases" to cool
things down. Today I want to briefly discuss what this all means to wealthy
Brazilians "on the fence" about US immigration intentions.
It is no secret the South Florida's Brazilian ex-pat
population has thrived in our local economy; it is also not a secret that many
Brazilian professionals who entered the US in H1B and L1 visas have overstayed
for a variety of reasons. Some of them have started thriving businesses after
losing their H1B sponsorship; still others have wound down the Brazilian home
company… while still possessing apparently valid L1 visas in their passports,
they are acutely aware of the reality that the closure of the foreign company
renders their current US immigration status nothing more than an artifice easily discoverable by the US consul or airport DHS officer.
Brazil's economy is expected to expand some 5.5% this year,
but some economists are warning of the 7% rate of growth. Like Indiana and
China, this type of growth — particularly in such a squiggly global economy —
means that Brazil will more than likely begin to tighten its money supply in
order to avoid the inevitable inflation which have long leg economies like
Brazil's. (The Journal reminds us that as recently as the early 90s, inflation
was in the four-digit range in Brazil.)
In a powerful, diversified, and commodities-driven economy such as Brazil's, all of this growth
means one thing: an increasing number of affluent Brazilians trying to
reconcile their country's economic boom with the historical lessons taught by
the instability of Latin American politics. For many — both those remaining in
Brazil and those already semi-transplanted into the United States — this
combination of elements opens up the possibility of international relocation…
usually to the US.
The main issue, at least as far as the uber-wealthy, is the
worldwide tax liability which comes with permanent residency in the United States. Yesterday, Melissa and I had a dynamic meeting
with Steven Cantor and his team. Steve, whose practice focuses on foreign
investors “transplanting” to the U.S., is a distinguished tax attorney with
whom we collaborate on a regular basis. Besides being just plain outstanding in his area of expertise, Steve is the only tax guy I've met who approaches problems creatively, a bona fide "outside the box" thinker in a profession known more for counting beans than seasoning them. I asked a lot of questions about
pre-immigration tax planning and the like, and, as usual, Steve had the answers
we needed…and those answers open many doors for our Brazilian clients with one foot in America and one eye on the tax implications of what that second foot will mean.
As we prepare for next series of EB5 investment seminars for
Latin America, the white-hot economy of Brazil is squarely within our sights.
Like so many others on this planet, many Brazilians with whom we speak simply
like the idea of U.S. residency as a Plan B, “just in case”, given the quality
of their current lives in Brazil.
There are legal ways to both immigrate to the U.S. AND to minimize tax implications through intelligent pre-immigration compliance structured by the right folks. Email if you have more questions and we'll get them answered!
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