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Join the Sovereign Society and we promised you we’d show you how to become a “sovereign individual.”  But what is a ‘sovereign individual’? How does a dedicated sovereign individual live life?  In our May 2004 issue, Bob Bauman described a typical domestic U.S. sovereign individual, the mythical “George Spelvin.” George had figured out how to live the “good life” in the U.S.A. (as much as the law now allows), with his own unusual versions of ironclad asset protection and personal and financial privacy.  But in time as freedoms diminished, George concluded greener pastures beckoned offshore. So he made the leap and now lives in the Republic of Austria, where he’s exploring new opportunities in his continuing journey toward individual sovereignty. Dateline: Vienna George Spelvin, sovereign individual, awakens in his small, but tastefully furnished, apartment on the outskirts of one of Europe’s oldest and most romantic capital cities, Vienna. Who could not be impressed living in this baroque city of the Hapsburgs, Mozart, Haydn, Beethoven, Schubert and Mahler. Only steps away from a streetcar line, George has easy access to the inner city and its famous Ringstrasse, yet he’s far enough out that he enjoys a nice view of the Danube Valley, with the rolling hills of the Wienerwald (Vienna Woods). Tight-Lipped But Friendly Even though George has a personal net worth of over seven figures, you’d never know it. And he never volunteers financial information. Indeed, as you may have guessed, “George Spelvin” isn't his real name. The world sees only an unremarkable individual, conservatively but informally dressed, pleasant in appearance, but certainly not a wealthy man to the less observant eye. And he always makes a point of not looking “American.”  Sit next to George on an airplane and he will be courteous if you initiate conversation, but he won’t discuss personal or financial matters. Indeed, George rarely talks to strangers; what others don't know about him can't hurt him. But a smile and friendly air compensates for his lack of talkativeness.

The Sovereign Society, headquartered in Waterford, Ireland, was founded in 1998 to provide proven legal strategies for individuals to protect their wealth and privacy, lower their taxes and to help improve their personal freedom and liberty. The Society's highly qualified contacts recommend only carefully chosen banks and investment advisors as well as financial and legal professionals located in select tax and asset haven jurisdictions around the world. The Society provides advice concerning the establishement and operation of offshore bank accounts, asset protection trusts, international business corporations (IBCs), private foundations, second citizenships and foreign residency, as well as practical safeguards for financial, Internet and personal privacy. The Sovereign Society stands alone in fulfilling this singular, international offshore service role for its members. To learn more about our organization and how you too can become a member, please click here.

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A New Home Offshore

George left the U.S. to get away from, among other threats, the PATRIOT Act, snooping financial police and property confiscation by civil forfeiture. Austria, with far greater respect for privacy, seemed a logical choice. And he likes Austria’s historic respect for property rights. No one here can be deprived of property unless it was wrongfully acquired and then, only after conviction in a criminal proceeding with proof of guilt beyond a reasonable doubt.10

George is smart enough to know that an American who obeys U.S. tax laws cannot escape all tax obligations by going offshore. George knows that the United States, unlike most other nations, imposes taxes on its citizens, no matter where they live. But before he left the good old USA, George sat down with his tax advisors and did some serious planning to avoid legally the extremely high Austrian income taxes, as well as reduce (to the max) his U.S. tax obligations.

Taxing Situation

With proper planning, George will pay Austrian income tax only on income that he actually brings into Austria. He arranged to have a foreign corporation he controls pay his salary to meet his expenses and any Austrian tax on that income is credited against his U.S. tax obligations. 

In addition, and happily for George, he probably won’t have any U.S. income tax obligations because, for a U.S. person living offshore, the first US$80,000 of income earned offshore is tax-free under U.S. law. George's foreign corporation, his employer, also can pay for his medical and dental insurance and contribute to an IRS-qualified pension or profit-sharing plan—all U.S. and Austrian tax free.

The Good Life

There’s almost always something happening in Vienna, year around, and George is enjoying his new life in Austria. 

Not just the Spanish Riding School, the Hofburg (Imperial Palace) and the Schloss Shonbrunn. But he’s also struggling to learn German, riding his bicycle and even doing the tourist thing—cruising the Danube. He has acquired, a blonde, blue-eyed Austrian fraulein friend, a university instructor who doubles as his German tutor. 

And George loves Austrian privacy. Browsing the Internet (just as he did in the United States, using up-to-date firewall, virus protection and “anonymizing” software) he came across the website for the Austrian Post. He was somewhat surprised to read: “Postal secrecy is irrevocable… the contents of your letter shipment cannot be re-routed, stored or recorded.”11 That’s something the U.S. Postal Service would never guarantee, George mused. By law, U.S. mailmen can double as government spies. 

Over those delicious chocolate torts at the Hotel Sacher Wien at dinner recently, George and his Austrian fraulein talked money. While George didn’t hesitate to describe his life in America and travels abroad, he avoided any discussion of his own financial affairs. Fraulein had no such reluctance, revealing that her vater was being audited because Austrian tax authorities suspected he was under-reporting income. 

“Why don’t the tax collectors just get a copy of his bank records to check income,” George asked, 
innocently.

“Nein! They can’t,” replied fraulein. “He must give them permission, and he won’t. And they don’t have enough evidence against him to go to court and force the bank to lift bank secrecy and disclose the information.” “At last,” George thought to himself, “I’ve found a truly civilized country.”
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Mark Nestmann is editorial director of The Sovereign Society. He is the author of numerous books on privacy, asset protection and taxation.

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