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  • #16
    If you do your own homework you will find that there are great courses based in the USA you can buy and do from home for $25.

    And if you troll the various USA web sites they all say only to do it if you are an expert in an area and you can view the property prior. Doing it long distance is specifically warned against again and again.

    Comment


    • #17
      Originally posted by pooomba View Post
      If you do your own homework you will find that there are great courses based in the USA you can buy and do from home for $25.

      And if you troll the various USA web sites they all say only to do it if you are an expert in an area and you can view the property prior. Doing it long distance is specifically warned against again and again.
      Thanks Dean for your pertinant comments - have been looking through US sites. I am definitely not interested in doing a RM course here.

      Still sitting on the fence I guess .... and doing further research.

      Comment


      • #18
        So $25 for a course out of the States or $$$$ to RM for their course or just don't touch these with a barge pole....

        Appreciate comments from FUPJ - at least if you follow RM advice for NZ activities and it goes wrong you have some recourse. If it goes wrong off shore you might as well have given your money to the Sallys.

        Comment


        • #19
          Just one other question. Is Phil or anyone else required to issue a disclosure statement if they are pushing financial products such as these leins?

          Is what RM/Jones doing defined as giving investment advice to the public? If so they would be required to provide an Investment Advisor's Disclosure Statement.

          Comment


          • #20
            Originally posted by bigcat View Post
            Just one other question. Is Phil or anyone else required to issue a disclosure statement if they are pushing financial products such as these leins?

            Is what RM/Jones doing defined as giving investment advice to the public? If so they would be required to provide an Investment Advisor's Disclosure Statement.
            I am sure you will find a disclaimer somewhere on the RM site to the effect that they are not offering investment advise, and are only providing an education.

            Paul.

            Comment


            • #21
              Yep, found it.

              The information on this site is not intended to be investment advice and Richmastery Ltd. recommends that you obtain specific professional advice from a suitably qualified expert prior to making any investment decision.

              Comment


              • #22
                There are huge profits to be made in US Tax Leins if its done the RIGHT way and at the RIGHT time, RIGHT place, to ignore this just because you are opposed to the most successful property education company in the history of New Zealand, might mean you are missing out on potential millions of dollars of profit, worth thinking about.

                Comment


                • #23
                  By the way

                  We have precisely the same type of sales in NZ, called "rating sales". There were loads of them in the early 1990s re small uneconomic rural blocks and tiny city sites.

                  See your own country first.

                  Comment


                  • #24
                    Originally posted by Green Fish View Post
                    We have precisely the same type of sales in NZ, called "rating sales". There were loads of them in the early 1990s re small uneconomic rural blocks and tiny city sites.

                    See your own country first.
                    I would agree - its a very big call to expose yourself to overseas trading risks, tax issues and foreign currency. And on top of this you have to pay big $ to RM and their overseas people.

                    I presume the people "investing" in these also put their money into Ray Smith's Goldcorp in the 80's.

                    Comment


                    • #25
                      Doing a little research into liens and I have read it is within a judge's power to sell the property and divide the proceeds amongst previous creditors besides the lien holder. When this happens, you don't receive reimbursement for the investment made.

                      Does anyone have any more information on this aspect?

                      Comment


                      • #26
                        Originally posted by mjmarketing View Post
                        Thanks for your informative post FUPJ - I went to the info. evening but was not sucked into the 2 dayer - boy those guys are good at a hard sell!

                        Please keep us posted when you get Matthew's report on whether he gives the thumbs up or down on Tax Liens.
                        I belive Matthew is not endorsing the tax Leins and has pulled out of it completley. I heard he felt it was to risky for his clients in NZ, I spoke to someone that did the 2 day course and Phil is trying to say Matthew gave them wrong advice, I would say its the other way around.

                        Comment


                        • #27
                          Matthew Gilligan's Position



                          12/3/09

                          From Matthew Gilligan

                          Dear Tax Lien Investor

                          This is a follow up to my discussion on the implications of tax lien investments at the recent seminar with Richmastery.

                          Since this time we have been carefully considering both the commercial viability of tax liens and the taxation consideration surrounding these investments. In doing so we have peer reviewed our views with 2 of Auckland's leading taxation practices (at our expense) to make sure we have our advice correct. This means our advice represents Gilligan Rowe's view, signed off by two other firms and you can therefore rely on it without question.

                          As background, it became evident during this process that a divergence of views was occurring between GRA and Phil Jones in terms of the use of an LLC structure. We felt heavily pressured to give a positive view of LLC structures and decided that to conduct a proper analysis, the only path was to withdraw completely and conclude our investigations away from Jones and his US advisors. What was interesting was that no research was done as to their viability prior to our involvement, which was confirmed by Richmastery's advisors in discussion by Larry Loftis.

                          As a result GRA has withdrawn from providing our advice via Jones as we feel the better process is for independent accounting advice to be provided directly to you, without commercial interests fettering GRA's view of best practice. Our concern to be frank is that Mr Jones is solely interested in selling the LLC structures for US$1000 + , when in fact other structures exist that may be better and cheaper.

                          Unfortunately the very nature of going cross border into foreign tax jurisdictions means hugely increased complexity and increased compliance costs on the US side of things. It is very dangerous to accept grossly over simplified advice, when there are in fact many variables and scenarios that you need to plan for, - or you can find yourself paying tax or paying professionals to plan your tax at great cost down the track.

                          As a result, we believe that you should tax independent advice on :-
                          1. What tax structures are appropriate to your individual circumstances, planning for both loss and profit scenarios;
                          2. "What if " scenarios on the impact of compliance costs and exchange movements on your investments, which in our view make the tax lien investments non viable for small investors.
                          3. Overall independent advice on whether this investment path is a good thing to do or not.
                          GRA have done some analysis and written a report that will make sense to most investor situations, and having done the research and peer reviewed it with a big 4 accounting firm and a cross boarder specialist taxation advisor, - we are now certain of our advice and ready to pass that benefit to you. We have decided that we will provide this generic advice to you for free, as it is in our view in the public interest to do this.

                          Please view this delay in providing this advice as it is intended: GRA say to you that our reputation is not for sale, the welfare of your affairs is our sole interest, and this is the reason we withdrew from dialogue with Jones and took time to make proper ( independent) inquiry.

                          We look forward to providing such information to you as required, - please contact Anthony Lipscombe . We will also have video blog available shortly for you to view on this matter.


                          Sincerely
                          Matthew Gilligan
                          Matthew Gilligan CA - E-mail Matt
                          Chartered Accountant Specialising in Tax Structures, Property & Trusts
                          Read my book: Tax Structures 101

                          Comment


                          • #28
                            Originally posted by tony72 View Post
                            I believe Matthew is not endorsing the tax Leins and has pulled out of it completely. I heard he felt it was to risky for his clients in NZ, I spoke to someone that did the 2 day course and Phil is trying to say Matthew gave them wrong advice, I would say its the other way around.

                            Very insightful Tony.
                            Matthew Gilligan CA - E-mail Matt
                            Chartered Accountant Specialising in Tax Structures, Property & Trusts
                            Read my book: Tax Structures 101

                            Comment


                            • #29
                              Tax Liens

                              I think we need to be careful not be condesending from our 'lofty positions' and just criticise this strategy outright especially on the basis of involvement of PJ & RM. They are involved with education in Property Investing and teach the basics well enough and I am sure most of you would agree that there is money to be made in PI.

                              For me there are no doubts that there is money to be made in Tax Leins if done professionally. I attended the evening info session and the main reason for not going further was the distance issue and most importantly the costs to get started and the compliance costs which have already been mentioned.

                              In other words you can't afford to dabble. You have to go into it prepared to put a decent chunk of money in (and I would be thinking $50k +) to start to be able to make enough money to get some reasonable profit starting to develop.

                              And because of this there is no way I would trust one course done through RM (and yes I know that it is actually being done through Dan's Dane Wealth Academy with I am sure RM getting a nice thank-you amount per person) to become enough of an expert to do this especially when combined with the limited amount of local tax and investment advisers that know enough about this stuff.

                              The last key point is if you are working a PI or trading strategy here in good old NZ that is working for you why would you allow yourself to be distracted by complexities of investing in something like this?? It just doesn't make sense.

                              Good luck to those who are having a go!!
                              Last edited by Goffo; 12-03-2009, 11:20 PM. Reason: Spelling mistake

                              Comment


                              • #30
                                Commercial Alert From GRA on Tax Leins

                                Commercial Alert From GRA on Tax Liens

                                I think tax liens are going to end up being a problem, for several of reasons but primarily because of the exchange exposure.

                                A fluctuation in exchange will cause issues for investors:-
                                1. A gain - pay tax on an accrual basis before you receive a return
                                2. Loss - real exchange losses
                                Hedging the exchange risk is too costly, eroding the return.

                                Unless you invest serious dollars, there does not appear to be cost benefit.

                                To be frank, I think Tax Liens are high risk due to the cross boarder issues and I am recommending to my clients not to got there. Jones/Richmastery overselling them and underestimating risk.


                                To investors, I say model your gains, and factor in compliance cost in the USA ( US$1500 according to RM tax attorney Larry LOFTIS), cost of the RM data, potential USA tax, exchange translation costs, additional tax planning costs to mitigate the tax, - add it up. Your working hard to recover the costs from your interest earnt on the lien.

                                Tax liens are great for a local investor in the USA - with no exchange exposure and whom already pays local compliance costs. Further the issues are local - they can drive or fly down the road, and sort out the issues. Not so from NZ.

                                You need to invest a minimum of NZ$100k to dilute the transactional and compliance costs, - and then you carry the exchange risk.

                                Tax Avoidance
                                Jacking up interest charged from NZ to your USA LLC - this is what Jones is recommending to stop paying tax in the USA. This is tax avoidance, no question. And there are rules on thinly capitalaised companies preventing this in the USA. Both IRD and the IRS will be concerned about this.

                                Hyperinflation
                                Another thing - what if we see hyperinflation ? At a presentation this evening a friend of mine asked Dr Bollard if we may see Hyperinflation again, which is something I'm worried about. Dr Bollard said it is a distinct possibility with the US printing cash and now Britain - its not hard to see this happening this year. What will this to the USD ? No one knows. Will it go to 10c against the Kiwi if inflation/interest rates sky rocket ? or 90c ? Will the USD stay the reserve currency if this occurs ? I don't want to be alarmist but these are uncertain times.

                                We have cash flow in our back yard with a property market that has melted down. There will be a truckload of mortgagee sales this year, and some real bargains. Well worth looking at.

                                Commercial Alert
                                I say don't go there. I am putting out a commercial alert - I think these things are risky and PJ is underestimating the risks.

                                We have suspended our relationship with Richmastery, - think about that.

                                I'm sure Phil will present this another way and spin it, but he is trying to charge Kiwis a fortune to take them to a place I don't want my clients to go in this environment.

                                So I have pulled GRA out of RM.

                                I'll shoot a video blog shortly, and provide a spreadsheet to potential investors that models the potential gains and costs - free to anyone who wants to look at it. Just punch in your investment and look at what might happen.
                                Last edited by Matt Gilligan; 13-03-2009, 12:14 AM.
                                Matthew Gilligan CA - E-mail Matt
                                Chartered Accountant Specialising in Tax Structures, Property & Trusts
                                Read my book: Tax Structures 101

                                Comment

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