From Land of the Free to Land of the Tax Slave

The US government is one of two in the world that has tax evasion crimes for non-citizens, and an exit tax for those who dare to leave the tax farm.

June 17, 2024

By: Bobby Casey, Managing Director GWP

tax Around 2013, a lot of people got really eager for Bitcoin and other cryptocurrencies to be legitimized by governments. I don’t know why. It’s like the eye of Sauron: once it sees it, it seeks to either possess it or destroy it. Here we are eleven years later and that’s exactly what happened: the Feds took Bitcoin seriously.

Another thing people begged the government to do is treat women equal to men. Let them into the military to fight. So they lowered the physical requirements and let them in. Today, the US is about to open up mandatory selective service registration to women as well as men.

The people who are happy about this are the same people who cheer on the idea of taxing non-profit organizations. The general expansion of the warfare state, welfare state, or tax plantation isn’t any private citizen’s triumph. It’s another nail in the coffin for liberty.

You’ll notice that when they aren’t pushing an agenda predicated on “safety” they are pushing it based on “fairness”.

If you’re not a fan of taxes and war, much less the wars taxes subsidize, then it might be time to consider an exit strategy from the US.

Let’s talk about Roger Keith Ver, endearingly known as “Bitcoin Jesus”. He was arrested in Spain in April and faces extradition. Get ready for some Ross Ulbricht level pettiness because nowhere else in the world, with perhaps the exception of Eritrea, would any of this constitute criminal behavior:

The DOJ charges include mail fraud, tax evasion, and filing false tax returns. The mail fraud charges are related to the delivery of forms to three IRS addresses.

The tax evasion part is crazy. Ver renounced his US citizenship in 2014. This is important to the timeline of events because the charges come years after he renounced his citizenship. Ver is a citizen of St. Kitts and Nevis, but prior to that he resided in Japan from 2005 to 2021. There’s nothing suspicious about renouncing citizenship if you don’t live in the US or spend much time there.

He allegedly took possession of Bitcoin from two US based companies, and failed to report the sale and subsequent capital gains from that sale.

Because they were US based companies, he was apparently required to report it to the IRS and pay taxes on it.

The fatal flaw was that he renounced his citizenship first and then decided to figure out what his “exit taxes” would amount to. He calculated incorrectly.

First of all, can we just linger on the term “exit tax” for a moment? According to Investopedia:

Expatriation tax rules in the U.S. apply to people who settled abroad permanently on or after June 17, 2008. These rules apply to anyone who expatriates with a net worth of over $2 million, fails to certify that they’ve complied with U.S. tax law for the five years preceding their expatriation, or who has an annual net income tax for the five preceding years over a certain amount. This amount changes each year based on inflation, but in 2020 it was $171,000.

The expatriation tax in the U.S. is based on the value of an individual taxpayer’s property on the day before their expatriation. … Any gain over $737,000 (2020 limit), a number adjusted regularly for inflation, is subject to tax.

Important to note as well, the US has a 183-Day Rule, whereby if you are not a US citizen or resident and you spend more than this amount of time in the US, you will owe taxes (expat or not):

The IRS considers you a U.S. resident if you were physically present in the U.S. on at least 31 days of the current year and 183 days during a three-year period. The three-year period consists of the current year and the prior two years. The 183-day rule includes all the days present in the current year (year 3), 1/3 of the days you were present in year 2, and 1/6 of the days you were present in year 1.

This exit tax is interesting because it’s meant for those who are renouncing citizenship to avoid US taxes. But you wouldn’t need to do this if you didn’t tax everyone so much.

Second, let’s talk about how Bitcoin was a laughingstock in 2014 to the feds. IF Bitcoin flopped, they would’ve hoped that Ver didn’t catch it and claim it, in fact. Instead, Bitcoin went up. And during that time it was in the blockchain not tied to any Social Security number or EIN. It’s 2024: ten years after he expatriated.

In 2015, it was worth $327. Today it’s worth over $65,000. When you’re talking about 70,000 BTC, that’s a lot of money. But it’s rather interesting that the only connective tissue they have to him at this point is that the BTC generated from US companies. This is the big brouhaha.

Everywhere I see this being reported, the same disgusting phrasing is used to describe it:

Ver allegedly caused the IRS a loss of at least $48 million. (Source:

The indictment alleges that Ver caused a loss to the IRS of at least $48 million. (Source: Forbes)

“Caused a loss”? To lose something means you must first HAVE it. I can’t lose something I never had. But this whole “IRS is the victim” verbiage burns my throat and triggers my gag reflex.

This comes straight from the IRS and DoJ, of course.

Finally, let’s circle back to the Forbes article. I cringed a few times reading it. He’s a gross apologist for taxation, which unto itself is difficult to consume.

He claims it’s not worth it to expatriate. If you’re wealthy, just pay the taxes. Sure, it’s a headache, but you don’t want to end up like this example: Roger Keith Ver:

Sure, retaining citizenship means that you’ll remain subject to U.S. income taxes and the burden of filing an annual return — together with nontrivial reporting burdens such as the Foreign Account Tax Compliance Act and foreign bank account reporting regimes. That’s a major frustration when you consider that the rest of the world adheres to residence-based taxation and seems to be doing just fine with that policy.

But if you’re fortunate enough to rank among the very wealthy, as is the case with Ver, those inconveniences will hardly matter.

The also cautions that if you perform the calculations of your exit tax before you leave, you can make a more informed decision on whether it makes sense to leave, while reducing the risk of winding up like Ver.

The Forbes author gave Mark Cuban as the paragon of a good taxpayer who paid in $275.9 million in federal income taxes for 2023. He was asked if he paid more than he owed to pay his fair share and he responded:

I pay what I owe. . . . This country has done so much for me, I’m proud to pay my taxes every single year. Tag a former president that you know doesn’t. [Mark Cuban, @mcuban, Apr. 14, 2024.]

Do I expect all of it to be used wisely? Of course not. But I’m still proud to be able to give back to our country. I’ve said it for years. After military service, paying your taxes is the most patriotic thing we can do. [Mark Cuban, @mcuban, Apr. 15, 2024.]

Deep throating the IRS boot like this is hardly virtuous. I’m surprised it’s not behind a paywall because it certainly isn’t family friendly. Why would anyone pat themselves on the back for paying taxes to an institution that has squandered their money, and driven the country into unfathomable debt through senseless warfare and welfare programs? What is Cuban eagerly funding exactly? At best he’s servicing a tiny fraction of the interest owed on the debt.

In the end, if the government wants to come for you, it will, as was the case with Ver. And if it doesn’t to, it won’t, as is the case with Joe or Hunter Biden. All this hype is supposed to deter you out of alternative investments and anything to do with offshore. In the end, we each need to live our lives, not like scared mice avoiding the hawk, but as free individuals who make the best choices we can for ourselves and our families.

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