Eduardo Saverin Renounces U.S. Citizenship Ahead Of Mega Facebook IPO (Can you say: "JOHN GALT" ?)
Eduardo Saverin, the Facebook co-founder immortalized by his falling out with Mark Zuckerberg in the movie The Social Network, has renounced his U.S. citizenship ahead of the company’s IPO.
Saverin, 30, may have made the move for tax reasons, hoping to avoid the highest rates before Facebook goes public. Although born and raised in Brazil before moving to the United States in 1992, he now lives abroad in Singapore. According to a spokeswoman, Saverin actually renounced his citizenship last September, but the information didn’t become public until Bloomberg reported that the IRS released his name on April 30.
Saverin would not be the first billionaire to renounce citizenship for tax purposes. John Dorrance III, heir to the Campbell’s soup fortune, cashed out of the family business when he sold his 10.5% stake in 1995-1996. Dorrance renounced his U.S. citizenship and moved to Ireland prior to the sale. John Fredriksen, oil tanker tycoon, jumped ship out of Norway in favor of tax-friendly Cyprus. Brazilian Lily Safra, widow to banker Edmond Safra, ditched Brazil for Monaco.
Other billionaires have left their homeland for non-tax reasons. Bidzina Ivanishvili, who wants to become prime minister of Georgia, renounced both his Russian and French citizenships to curry favor with voters. Ted Arison, deceased father to current billionaires Micky and Shari Arison, left the U.S. for Israel in 1990.
Since his falling out with Zuckerberg, Saverin has sold more than half his Facebook stake and has used some of that money to invest in promising startups. In January 2011, he led an $8 million round of financing in Qwiki, which works to improve the way people experience information online. In March 2011, he led a $6.5 million round in Jumio, whose first product, online payment method Netswipe, uses a webcam as a verification device.
Saverin doesn’t cite tax reasons for his decision. “This was done many months ago and had nothing to do with the IPO,” said spokeswoman Sabrina Strauss.
“Eduardo recently found it to be more practical to become a resident of Singapore since he plans to live there for an indefinite period of time,” said Strauss, in a statement provided to Forbes. “He has invested in Asian, U.S. and European companies. He also plans to invest in Brazilian and global companies that have strong interests in entering the Asian markets. Accordingly, it made the most sense for him to use Singapore as a home base.”
Saverin graduated magna cum laude from Harvard in 2006 with a degree in economics. He was president of the Harvard Investment Association and member of the Phoenix S.K. Club. Andrew Garfield, the new Amazing Spider-Man, played Saverin in The Social Network.
Now that Saverin is no longer a United States citizen, he will depart the Forbes 400 list of wealthiest Americans where he and his fellow Facebook co-founders Zuckerberg, Dustin Moskovitz, and Sean Parker have recently climbed the ranks. However, he will remain among Forbes’ annual counting of the world’s billionaires.
Read the details here: http://www.forbes.com/sites/briansolomon/2012/05/11/eduardo-s...
Read More: http://www.forbes.com/sites/briansolomon/2012/05/1...
By John D. McKinnon
Eduardo Saverin, the Facebook co-founder who gave up his U.S. citizenship, has nothing against the U.S., just its complicated rules on U.S. citizens holding money overseas, a spokesman said.
Mr. Saverin, who now lives in Singapore, decided last year to renounce his U.S. citizenship, a decision that was made public a few days ago. The move sparked an outcry among some tax experts who suspect he’s aiming to save on taxes. Although Mr. Saverin will have to pay a hefty exit tax for renouncing his citizenship, based on some calculation of his assets, Singapore is a relatively low-tax jurisdiction, particularly for foreign investors, and does not levy capital gains tax. Thus he could save in the longer term.
[More from WSJ.com: How Facebook's Elite Skirt Estate Tax]
In a political environment that’s rife with talk of raising taxes on the wealthy, Mr. Saverin’s case could become another flash point.
Saverin spokesman Tom Goodman said Sunday his renunciation was prompted not by tax considerations but by U.S. rules that make it more difficult for U.S. citizens to live and invest overseas.
“U.S. citizens are severely restricted as to what they can invest in and where they can maintain accounts,...
By John D. McKinnon
Eduardo Saverin, the Facebook co-founder who gave up his U.S. citizenship, has nothing against the U.S., just its complicated rules on U.S. citizens holding money overseas, a spokesman said.
Mr. Saverin, who now lives in Singapore, decided last year to renounce his U.S. citizenship, a decision that was made public a few days ago. The move sparked an outcry among some tax experts who suspect he’s aiming to save on taxes. Although Mr. Saverin will have to pay a hefty exit tax for renouncing his citizenship, based on some calculation of his assets, Singapore is a relatively low-tax jurisdiction, particularly for foreign investors, and does not levy capital gains tax. Thus he could save in the longer term.
[More from WSJ.com: How Facebook's Elite Skirt Estate Tax]
In a political environment that’s rife with talk of raising taxes on the wealthy, Mr. Saverin’s case could become another flash point.
Saverin spokesman Tom Goodman said Sunday his renunciation was prompted not by tax considerations but by U.S. rules that make it more difficult for U.S. citizens to live and invest overseas.
“U.S. citizens are severely restricted as to what they can invest in and where they can maintain accounts,” said spokesman Tom Goodman. “Many foreign funds and banks won’t accept Americans. This was a financial rather than a tax motive.”
[More from WSJ.com: The Facebook-Free Baby]
It’s true many U.S. expats complain that American rules are making life more difficult for them. Those include the U.S. tax system’s global reach (many countries tax based on residency); foreign bank account reporting rules; and the Foreign Account Tax Compliance Act (FATCA), which requires foreign financial institutions to start reporting to the IRS on U.S. citizens’ accounts.
Expats say as a result of all the regulations, some foreign banks are dumping more U.S. customers. Mr. Goodman also cited FATCA, among other rules, as a problem for Mr. Saverin.
[More from WSJ.com: How Facebook Could Trip Up Investors]
Treasury Department officials say they don’t see evidence of a systemic problem for Americans living abroad arising from FATCA. People as wealthy as Mr. Saverin tend to have an easier time untangling red tape than the average U.S. retiree living abroad.
The spokesman said Mr. Saverin plans to continue to invest in tech companies around the world, including the U.S.
“His decision had nothing to do with dissatisfaction here, but with his strong desire to do business there,” Mr. Goodman said. He also plans a charitable foundation.
http://finance.yahoo.com/news...
I take it that you are not familiar with "John Galt" http://www.forbes.com/sites/r...
When the government is in the habit of selectively enforcing the laws that our leaders have sworn to uphold, the transient "constitutional protections" are no longer worth what "The Rich" are having to pay for those "protections". Yes, only if you have the money to leave. Or only if you no longer choose to be a slave.
When our tax system is really just a lien against whatever you own and will earn throughout your life... and AFTER your life... you are simply property of the state... er of the Plantation!
I'm not against paying taxes mind you... I'm against the confiscation of taxes. That's why I support tax reform and replacing the existing system with the FairTax (HR-25) which is a consumption tax and is only paid when I CHOOSE to buy something in a taxable transaction (vs an exempt transaction) http://www.fairtax.org/site/P...
I take it that you are not familiar with "John Galt" http://www.forbes.com/sites/r...
When the government is in the habit of selectively enforcing the laws that our leaders have sworn to uphold, the transient "constitutional protections" are no longer worth what "The Rich" are having to pay for those "protections". Yes, only if you have the money to leave. Or only if you no longer choose to be a slave.
When our tax system is really just a lien against whatever you own and will earn throughout your life... and AFTER your life... you are simply property of the state... er of the Plantation!
I'm not against paying taxes mind you... I'm against the confiscation of taxes. That's why I support tax reform and replacing the existing system with the FairTax (HR-25) which is a consumption tax and is only paid when I CHOOSE to buy something in a taxable transaction (vs an exempt transaction) http://www.fairtax.org/site/P...
And Francisco d'Anconia, or however his name would translate into Portuguese.
Certain people better watch out, or you'll next hear about another name:
Ragnar Danneskjöld.