PRESS RELEASE: Offshore Investment Advisor and Josh Ungerman write a White Paper on ‘Accidental Americans’ and the Offshore Voluntary Disclosure Initiative

TORTOLA, BVI – July 19, 2010 – Offshore Investment Advisor, a Registered Investment Advisor in the Caribbean, in association with LGS & Associates, announced today that it has teamed with Josh Ungerman of Meadows, Collier, Reed, Cousins, Crouch & Ungerman, L.L.P., to raise awareness within the Caribbean community on some of the tax implications associated with being a dual citizen with a US passport or US birth certificate.

“We are pleased to have teamed with Josh Ungerman, as part of our new financial education campaign called ‘Raise Your Financial IQ’, to write this White Paper and educate individuals on the IRS’ new Offshore Voluntary Disclosure Initiative,” said James Bridgewater, principal of Offshore Investment Advisor. “At Offshore Investment Advisor we believe that wealth management is more than simply helping clients create and manage portfolios tailored to their unique financial needs.  It is as much about minimizing unnecessary losses due to penalties associated with improper tax reporting or relying on very conservative securities, such-as short-term CDs, that currently offer a negative real rate of return.” 

“It is not uncommon for residents of the Caribbean to travel to the United States, USVI or Puerto Rico and have a baby.  As a result, a relatively high percentage of Caribbean residents were born in a US territory and therefore are dual citizens of their home country and the US,” said Josh Ungerman, a former US IRS Chief Counsel Senior Attorney & US Department of Justice Tax Division Special Assistant US Attorney is one of the foremost experts assisting clients with US tax obligations.  “While there are many benefits of US citizenship, once an individual is subject to the US tax regime, the individual is taxed on his/her worldwide income.” 

Though this is shocking to some at first, it is not as onerous as it sounds because there are certain provisions in the new OVDI that allows for significantly reduced penalties provided that individuals take action before August 31, 2011.

This new White Paper educates individuals who have a US passport or birth certificate on the steps they need to take in order to meet their obligations to the US IRS.  In particular, it highlights the key requirements for an individual to be considered an ‘Accidental American’ and therefore qualify for significantly reduced penalties from 25% to 5% (or even 0%). 

“Ongoing financial education across the Caribbean is important to our ability to remain a vibrant, growing community and to evolve with the rapidly changing and increasingly complex offshore financial landscape,” said Lorna Smith, founder of LGS & Associates, a BVI-based consultant on international business and finance related matters.  “This White Paper will help individuals understand the new realities of this changing environment.”

Please visit http://www.offshoreinvestmentadvisor.com/Investor-Resources/white-papers to download the White Paper.

Media Contact:

James Bridgewater

Offshore Investment Advisor

james@offshoreinvestmentadvisor.com

284-495-4179

About Offshore Investment Advisor

Founded in 2005, Offshore Investment Advisor has established itself as a leading investment manager in the Caribbean by leveraging the strengths of TD Ameritrade Institutional, a globally recognized leader in brokerage and custodial services, as well as by working closely with our clients to understand their entire financial picture and then delivering on their specific financial needs and goals.  Headquartered on Tortola, BVI, we are a boutique provider of wealth and asset management to individuals, families, trusts and BVI employers.  Our services center on your unique requirements and include the following comprehensive solutions: Private Wealth Management & Retirement Plan Services. 

For more information please visit: http://www.offshoreinvestmentadvisor.com/

About Josh O. Ungerman, Partner

Mr. Ungerman specializes in the resolution of tax matters.  He specializes in IRS voluntary disclosure and has extensive experience in the IRS 2009 VDI Program as well as the current IRS 2011 OVDI Program.  The tax matters in which Mr. Ungerman is involved are typically very complex from both a factual and legal perspective. These matters often require legal and accounting skills.  Mr. Ungerman is also a Certified Public Accountant.

Prior to joining private practice in 1994, he was a civil prosecutor for the Internal Revenue Service, Dallas District Counsel office. He was also a Special Assistant United States Attorney for the Department of Justice Tax Division in Dallas during his time as a civil prosecutor.  Prior to becoming an IRS attorney of a special assistant US attorney, he served as a law clerk to the Honorable Carolyn M. Parr at the United States Tax Court in Washington, D.C.

Mr. Ungerman is a past President of the Dallas Bar Association and a past Chair of the State Bar of Texas Tax Section Controversy Committee.  He is currently a Fellow of the American College of Tax Counsel and is currently a Vice Chair of the American Bar Association Tax Section Civil & Criminal Penalties Sub Committee.

Mr. Ungerman was admitted to practice in Texas in 1990.

For more information please visit: http://meadowscollier.com/attorneys/ungerman-josh-o/

Gold hits a new high but pound for pound this puppy is worth more!

Gold is hitting new all-time highs on possible QE3 and safe-haven protection as the European debt crisis and US debt ceiling talks heat up.



But at 50 pounds, this puppy is worth more than his weight in gold (and may offer more protection):

"A red Tibetan mastiff has become the priciest dog in the world after being sold for 10 million Chinese yuan, or £945,000...  Big Splash, or Hong Dong in Chinese, was bought by a coal baron from the north of China."  To read more please see Red Tibetan Mastiff: 'Most expensive' dog sold for nearly £1m | Mail Online

Prepare for a Sell-Off When the Debt Deal Is Struck - Seeking Alpha

Prediction markets, like Intrade, are by no means the be-all and end-all when anticipating the likely outcomes of future events. Many times they can be thinly traded or poorly designed, among other issues. However, prediction markets can be a very useful tool for gaining information on an unknown future event and provide an additional data point to fill in missing or unclear information. So with that said: What does Intrade predict for the timing of a U.S. debt ceiling increase?

To read more please read: Prepare for a Sell-Off When the Debt Deal Is Struck - Seeking Alpha

No Rest For The Weary

Well that was an interesting month. An interesting six months really!  I can’t remember a time when there were so many breathtaking, heartbreaking, earth-shattering headlines: Middle-East uprisings, Japanese catastrophes, bin Laden dead, European sovereign debt crises, US debt ceiling debates, floods, etc.  And to top it all off the sensational and controversial conclusion of the “OJ Simpson-like” murder trial of Casey Anthony.

While the 1^st half of the year has been disappointing, we expect the 2^nd half to provide a better environment for gains as there is resolution on Greece/Europe and the US debt ceiling, among other things.  Very similar to last year, May and June were tough months; however July 2010 through December 2010 produced a 20%+ rally in the S&P500.  2011 could be similar as negative headlines wane—case in point: markets having already staged a tremendous rally over the last week of June and into July.

In June, our focus was on Europe where it appears that Greece has been given a new (temporary) lease on life.  Despite agreement on the Greek bailout, there are still questions on how a debt roll-over will be treated by the ratings agencies, whether or not the Greeks will deliver on their austerity promises, not to mention the health of other periphery European countries (in particular Portugal whose debt rating was lowered to junk by Moody at the time of this writing).  Despite these hurdles it appears that many of the near-term major issues have or will be been resolved.

Now in July, our focus has shifted to US politics where political empowerment seems to be taking priority over common sense and the need for financial stability.  In our opinion, Republicans need to compromise and agree to some tax hikes and Democrats to significant budget cuts.  However, so far, Republicans have been unwilling to compromise and this has manifested itself in predictions for if/when the US debt ceiling will be raised.  According to predication markets leader, www.intrade.com, there is only 33% chance that debt ceiling will be raised above $15.1 trillion by July 31, 2011.  See figure 1 below.

Figure 1: The chart above shows the likelihood that Congress will approve an increase in the US debt ceiling to $15.1T or more before midnight ET 31 Jul 2011.  Source: www.intrade.com

If the debt ceiling is not raised before the August 2nd deadline, then the current rally that resumed at the end of June will be hindered.  Despite the importance being given to raising the debt ceiling, it is important to note that the US congress (Republican and Democrat controlled alike) has raised the debt ceiling 22 times since 1981—from $1 trillion to the current level of $14.3 trillion (source: Wikipedia).  So this is nothing new.  What is different this time is the extraordinary polarization of American politics, partially attributable to the Tea Party’s rise to power in the past election.  We are confident that a deal will made, however the timing is questionable.

On a final note, I apologize for so much gloom over the past several commentaries … I am usually a much more cheery person!  Sometime (hopefully soon) the tone of these commentaries will turn rosy again and we will be talking about how many gazillions of dollars people are making from social media stocks or some other extraordinarily positive news.

Bottom Line: No rest for the weary.  Although we are getting close to resolution on most outstanding issues, it is not time to head to the Soggy Dollar to sip Pain Killers during the summer slowdown quite yet.  The US debt stalemate is a huge issue, but, as history suggests, it is a resolvable one.  As such, we still consider corrections as buying opportunities in select markets.  As we have stated over the past several commentaries, with resolution we should see a substantial lift to the markets.  We saw it with Greece; now hopefully we will see it with the US debt ceiling.  Should the situation in Europe significantly deteriorate again or the US Congress prove unable to reach an agreement, then we will reassess our position.