What is a bank account at sea?

If the term "offshore bank account" evokes pictures of refuge billionaires and bosses of organized crime, be prepared to check reality. In general, any bank account open outside the home country can be considered an offshore bank account. There is usually no big difference between the bank on the corner and the Cayman Islands bank. The appeal is much more evident during the tax period when assets and income must be reported to IRS or other government income agencies abroad abroad.

Since the banking industry is about 10% storage and 90% accounting, many smaller countries can offer offshore bank accounts without your own investment. Island nations, such as Cayman Islands or Islands, can successfully compete with Switzerland or Belgium for offshore banking customers. Local laws can reduce or eliminate taxes placed on traditional bank accounts. Therefore, some companies abrasive individuals prefer openingBank account in small states of rulers that allow account holders to remain practically anonymous.

For many years, a bank account has been a really convenient way to hide profits from illegal activities or insufficiently announced business earnings. The United States (IRS) internal revenue service (IRS) would have little knowledge of the money stored elsewhere. Offshore banks were not obliged to report the existence of these accounts and account holders could legally pay any taxes. In recent years, however, the rules governing offshore banking have become much stiffer. Any bank account containing over $ 1,000 in the US (USD) must be reported as an IRS income, no matter where the bank account is.

Many people are considering opening offshore bank account for very legitimate financial reasons. The inhabitants of a political party or an economically unstable country can provide an account in a steadya nasty country. If the government should collapse financially, residents can still protect their money from the National Bank. Those who often travel to Europe or Asia may benefit from an account in England or Japan. The exchange rate between foreign currencies is often more favorable with "local" accounts. With the advent of electronic banking, offshore bank account holder can often easily make routine transactions without traveling abroad.

There is still a stigma associated with a bank account at sea due to some financial acts in the gray area, but there is nothing illegal or unethical about opening one of the legitimate reasons. Some foreign banks may require a significant initial deposit or other restrictions, but the benefits of lower tax obligations or higher interest rates usually outweigh these obstacles. Most accounts are protected by international banking. Many foreign banks offering such services are advertised on the Internet and in investment -oriented periodicalse.