Socialite Denise Rich Dumps U.S. Passport

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DynoDon

http://finance.yahoo.com/news/socialite-denise-rich-dumps-u-s--passport.html

"(Reuters) - Denise Rich, the wealthy socialite and former wife of pardoned billionaire trader Marc Rich, has given up her U.S. citizenship - and, with it, much of her U.S. tax bill.

Rich, 68, a Grammy-nominated songwriter and glossy figure in Democratic and European royalty circles, renounced her American passport in November, according to her lawyer.

Getty ImagesHer maiden name, Denise Eisenberg, appeared in the Federal Register on April 30 in a quarterly list of Americans who renounced their U.S. citizenship and permanent residents who handed in their green cards.

By dumping her U.S. passport, Rich likely will save tens of millions of dollars or more in U.S. taxes over the long haul, tax lawyers say.

Rich, who wrote songs recorded by Aretha Franklin, Mary J. Blige and Jessica Simpson, is the latest bold-faced name to join a wave of wealthy people renouncing their American citizenship. Facebook co-founder Eduardo Saverin gave up his U.S. passport to become a citizen of Singapore, an offshore tax haven, before the company's initial public offering in May.

[Related: Democrats, Republicans Square Off Over Taxes]

Nearly 1,800 citizens and permanent residents, a record since data was first compiled in 1998, expatriated last year, according to government figures.

Rich, who was born in Worcester, Massachusetts, has Austrian citizenship through her deceased father, said Michael Heidt, a lawyer in Hollywood, Florida, who represented her in a recent lawsuit.

He said Rich had dumped her U.S. passport "so that she can be closer to her family and to Peter Cervinka, her long-time partner." Rich's two daughters live in London; Cervinka, a wealthy property developer, is an Austrian national. Rich plans to make London her main residence and does not intend to acquire other passports, Heidt said.

MARC RICH's PARDON

Rich's ex-husband, commodities trader Marc Rich, fled the United States in 1983 when indicted on charges of tax evasion, fraud, racketeering and illegal trading of oil with Iran. They divorced in 1996.

Marc Rich received a presidential pardon in 2001 on President Bill Clinton's last day in office. Federal prosecutors and Congress investigated the pardon, and in 2002 a House of Representatives committee concluded Denise Rich had swayed the action through donations to the Clinton library and campaign.

Dubbed "Lady Gatsby" by Yachting magazine, Rich owns multiple properties, including a mansion in Aspen, Colorado. She is a frequent habitue of Cannes, Monte Carlo and St. Tropez with celebrities and singers aboard her 157-foot yacht, Lady Joy.

Rich will escape future U.S. taxes but possibly not all current ones. In 2008, Congress imposed an expatriation tax on persons with a net worth of more than $2 million who dump their U.S. citizenship or permanent residency. Under the law, those people owe an "exit tax" on their worldwide property, computed at a fair market value the day before they leave. But tax lawyers say the tax can be reduced or avoided by structuring asset holdings through foreign annuities.

While Austria, like the United States, generally taxes its citizens on their worldwide income, it has generous tax breaks for citizens who spend half the year abroad.

[Related: Facebook Co-Founder Saverin Gives Up U.S. Citizenship]

In January, Rich put her 5th Avenue penthouse in New York on the market for $65 million, according to the listing agent, The Corcoran Group. New York property records show Rich acquired a 100 percent stake in the apartment, described by Corcoran as "the epitome of luxury and grandeur," for $200,000 in 2006. Bonnie Evans, the Corcoran broker for the property, declined to discuss details.

COOK ISLANDS TRUST

The recent lawsuit against Rich was filed on behalf of Lee Goldberg, the former protector of a Cook Islands trust of which Rich is a beneficiary, in February. The case was dismissed in April, court records show.

The Cook Islands, a South Pacific tax haven, offers Swiss-style secrecy for wealthy investors.

The lawsuit accused Rich and Richard Kilstock, a British real estate entrepreneur who is married to Rich's daughter Daniella, of "transferring, moving or secreting trust assets, in violation of the trust's guidelines and without the knowledge or permission of Goldberg."

Rich and Kilstock denied the charges and accused Goldberg of altering trust documents, court filings show.

Both Goldberg and his attorney, Donald Thomas, declined to discuss the case. Rich recently dismissed Goldberg, one of her long-time lawyers, as protector of the trust.

Heidt, who also represents Kilstock in the case, declined to discuss the lawsuit. Kilstock did not return calls requesting comment.Another touching story of the rich and their patriotism. Thank you Slick Willie for your pardon. It also shows the tax code is so thick because of loopholes for the rich-not wage earners.

 

Comments

drc2
Yes, in the age of Corporate

Yes, in the age of Corporate Corruption and Money Uber Alles, there are some richie rich aholes on the Center Left who are covering their assets.  Progressives have stipulated that the Democratic Party has competed in the culture of corporate corruption rather than fight against it.  How immoral this might be considered is hard to weigh against those who are corrupt by principle rather than concession to it.  At some point, we would be glad to send the Democorpos to you GOPimps while accepting reborn ex-cult zombies back into reality for our overwhelming majority.

Look how Republican this "Democrat" really is!  Scandalous!

tayl44
tayl44's picture
Do patriotism have a price?

Do patriotism have a price? If so, does the definition remain the same? The rich are like them ships that ride the seas under the "cheapest flag". These "flagless people run the world",may God have mercy on us.  

DynoDon
Wasn't it F. Scott Fitzgerald

Wasn't it F. Scott Fitzgerald who said the rich are different from the rest of us? While it is expected for the average American to have tears in his eyes when the national anthem is played, the rich are looking for their next tax dodge.

tayl44
tayl44's picture
Maybe we need to do the same

Maybe we need to do the same as the rich,maybe tears will come to their eyes. They would really need the government when revolution is knocking on the door.