Now that we’ve gone over some of the nuts and bolts of offshore investing, let’s look at a few other investors who have delved into the international arena.

Sarah and Bill have a plan. They’ve heard about investment property in Costa Rica—beautiful locations, great weather, ease of living.

IRAs and qualified plans can borrow funds, but the accounts themselves cannot be used as collateral for loans for personal use.

When you are eligible or required to take distributions, you can opt to receive either the entire sum or periodic distributions for the rest of your life.

For IRAs, the custodian or trustee is normally a bank, savings association, insurance company, or any other entity deemed by the Secretary of the Treasury to be able to carry out the responsibilities.

The tax advantages vary depending on whether you are using a Roth or traditional IRA.

To get started, the first thing you need to do is open a self-directed account and transfer or roll over funds from your existing retirement plans.

An excellent way to minimize your tax obligation in the United States is to use your retirement funds to purchase real estate—either domestically or internationally.

The bottom line is that the Internal Revenue Code includes legal methods that you can use to avoid or minimize tax if you are investing outside the United States.

The U.S. estate and inheritance taxes are very complex if you own property in other countries.

A U.S. taxpayer or U.S. company can own 100 percent of the stock of a “qualified” foreign corporation and not be required to pay any U.S. income taxes on any profits of that foreign corporation.

When you invest in property outside the United States, you will likely need to establish an account in the local country to pay various expenses and to collect income.

Because the United States taxes you on your worldwide income, you may be double taxed.

If you are a U.S. resident or citizen, one way to reduce taxes is to permanently give up your citizenship and residency.