Posted by forex at 7:46 AM
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1. Find a reputable online brokerage in the country in which you're looking to open an account. Review the fees, terms and additional conditions for working with the company. This brokerage will have its own software for trading. Many foreign brokerages don't offer demo accounts, and it's difficult to find reviews of their services online. This can make it risky to open a foreign brokerage without positive references from other traders.
2. Determine how you will be taxed in your locality. Contact a tax lawyer before considering opening a foreign brokerage account to ensure that you won't be paying more than you expect. You will have to declare foreign brokerage accounts in excess of $10,000 to the IRS. In most cases, however, if there is no capital gains tax in the country in which the account is opened, you won't need to pay any capital gains. Find out what sorts of international wire transfer fees you will need to pay to move your money into a domestic account.
3. Consider starting a foreign trading company to open the brokerage account for you. In many cases, this greatly simplifies your taxpaying requirements. For example, if you plan to open a brokerage account in the Bahamas, it may be more convenient to start a corporation in the Bahamas to open the account for you.
4. Open an account in the brokerage that meets your needs as an investor. Trade securities through your new online foreign brokerage account.