It is well known in the international tax forums that US citizens tax planning is an impossible mission.
As reported in the LA Times: Facebook’s Eduardo Saverin gives up citizenship: Shrewd tax move?
“Here’s a tax tip for Mark Zuckerberg: Give up your U.S. citizenship. The 27-year-old Facebook Inc. founder could face a tax bill of more than $1 billion after the company’s initial public offering, expected next week. His former Harvard classmate who is known as “the other Facebook founder” may have found a way to cut the bill. Eduardo Saverin, who now lives in Singapore, has given up his U.S. citizenship. Tax experts say it’s a shrewd move. Saverin, who was immortalized in the film “The Social Network” as Zuckerberg’s contentious former friend and business partner, has a 4% stake in the company, according to the Who Owns Facebook? website. His stake could be worth nearly $4 billion after the IPO.
“It’s definitely savvy tax planning,” said Edward D. Kleinbard, a professor of law at USC who specializes in federal tax policy and international taxation. “He can argue that the value of the Facebook shares in September, when he gave up his citizenship, were significantly less than the value that will be set at the IPO next week.”
Saverin’s spokeswoman said his decision to jump ship had nothing to do with the upcoming IPO and the potential tax liability. (more…)