Dan: So this is Dan of Vagabond Awake, the YouTube Channel for VagabondBuddha.com. And we’re lucky today to have Jeff on the channel. Today our guest, Jeff, is gonna share very four very important things if you’re considering retiring overseas. Number one is that there’s a Medicare supplement you can get if you’re a US citizen that will cover $50,000 of, of healthcare expenses when you’re overseas.
This is an automated audio-to-text translation of this interview done by https://www.descript.com/
The second thing is he shares some tips on establishing a Florida domicile. That refers back to a video we did a couple of weeks ago. The third thing is Jeff shares about some of his favorite hospitals, and I’ve had the same experiences with hospitals and dentists in Southeast Asia. And fourth, if you open an account overseas and you’re a US citizen, there are foreign account reporting requirements that you should learn about.
Okay, let’s get going. About a week ago I did, an interview with a gentleman who explained how a service he was using to his residents move from Hawaii to Florida. And [00:01:00] Jeff our guest today sent an email saying that not all states are the same. Some are more aggressive than others, so you need to be careful.
And as with all things like this on my channel that we discussed, We’re just raising issues. Jeff and I are not qualified to talk about tax law. We’re raising an issue so you can talk to your lawyer intelligently about what your fears are. So Jeff, tell us, tell us what you learned about it and help people understand maybe what, what they’re up against so they know what to ask their lawyer.
Establishing Domicile in Low Tax States Before Moving Overseas
Jeff: Well, the fellow you were interviewing had come from Hawaii and he was talking about how he had changed his residency to Florida cuz his parents were still in Florida. And he briefly mentioned the very well-known case of the people in California. Who had moved offshore for 10 years and were US citizens, so they dutifully continued to file their 10 forties every year.
But of course, since they weren’t in [00:02:00] California anymore, they didn’t file their California return, and then for whatever reason, be it family or health, they returned after about 10 years to California and became residents again, and California came after them and said, Hey, You haven’t been filing your California returns.
They said, well, we haven’t been living here. California said that doesn’t matter. You, you were residents when you left. You were residents while you were away and you’re residents now. And they took this all the way up, not to the Supreme Court, but the one just below it. And I believe the Supreme Court declined to hear it or at that, I’m not qualified to state.
But they went all the way up. In terms of legal challenges and loss. So the state bankrupted them because not only did they have to pay all the income taxes, but they were charged penalties and interests as well as their legal fees. So it was quite financially devastating. And on a further note to that, because I was a New York resident and that’s the second [00:03:00] most aggressive state.
In the guide that I followed, they talk about this couple who retired to Florida and kept their New York residences, but they were, they became, they thought they became Florida residents and they had a similar thing where New York State came after them and said, Europe’s still New York residents, and you have to continue to file.
So now to backtrack a little bit, I had been planning to move offshore for a long time, and I actually had acquired a place in Florida because my mom was down here and I had a couple of brothers down here. And when I knew that I wanted to live offshore at some point, I made preparation, so all I’m doing is sharing my experience as you stated at the beginning of this video, this is not legal advice to anybody, but this is what, what I did and other people I know did, and just something to be aware of, depending upon how aggressive your state is.
[00:04:00] So I made a deliberate decision around 2017 to move to Florida full-time. I got rid of my New York residences and I followed. A very specific procedure to establish my Florida residency, which I actually learned about in this book called The Florida Domicile Handbook. And I can give a link that you can put in the and the title that you can put at the bottom of this video.
Dan: And I will. Here is the link to the book. 
Jeff: Yes. And it gives you very specific steps to follow. For instance, you’re declaring a, you’re filing a declaration of domicile and you’re getting your Florida driver’s license. And your it, it’s step by step by step. Register to vote. Register automobiles and apply for your homestead exemption. By the way, the fellow you interviewed from Hawaii did not [00:05:00] specifically own a home, and they tell you you don’t need to in this book, it just bolsters your defense.
But the gist of it is if you’re going to be moving offshore or planning to at least. That was my plan. The rule of thumb is that you have to, if you don’t want to have to continue to file state returns from the state you’re leaving, you need to establish residency in a different state. Probably one of the six or seven that doesn’t collect income tax, and then you have to file.
Here is Jeff’s book on Amazon. The book is called Don’t Quit, Stories of Persistence, Courage, and Faith. Jeff wrote chapter 11. It is available in both paperback and Kindle Unlimited.
Returns, I’ve heard two years, but actually they state in this book, as I was brushing up on it prior to our talk three years of residency, that because if you file an income tax, return it as long as you filed a return. There’s a three-year statute of limitations, so long as it’s not fraudulent and so long as it’s not challenged by the state.
[00:06:00] So the idea is that you will have moved from your high tax state into your lower tax or no tax state, and you will file either a final return with your high tax state and then or else if you still have income coming from there, which I do. You then file non-resident returns each year. And if those returns go through for three years unchallenged, then the statute of limitations has passed on your initial return, and you are establishing yourself as a residence in your new state and not being shown challenged by your old state.
So again, This is simply for me now, it’s been six or seven or more years, so it’s been a while, but it’s important to check with your legal professional and to see exactly what you need to do. If you want to establish a new residency, I did it. Planning to go offshore. And of course I still [00:07:00] spend a lot of time offshore, as Dan knows since we’ve communicated about that.
But I haven’t fully moved offshore at this point. After Covid kind of threw a monkey wrench into that plan, and at some point, I will, but at the moment I’m still just going offshore for months at a time.
Dan: That’s great. Wow, that’s very helpful. And so the book you showed us and we’ll put a link to below, as you mentioned.
Jeff: Amazon? Is that right? Yes, you can get it on Amazon. It’s the edition that I currently have is the fourth edition because I keep giving away my books to friends who move here, and then when I order the new one, it’s a later edition.
And, they correct typos and, and continue to buttress their information in the book. And it’s called, The [00:08:00] Florida Domicile Handbook, and it’s written by E Michael Kilborn, who has a whole alphabet soup of qualifications after his name. And Brad a Galbraith who’s a lawyer and a c p a. And my business partner actually preceded my move to Florida, and he was the one that discovered this book, and then he turned me onto it.
Gone through it with my accountant and with numerous other legal professionals, and this is the Bible of how to move to Florida. Now, it’s probably helpful if you’re going to one of the other no-income tax states and you can’t find a guide that gives you the level of detail that you can find in this book.
But this is specific to Florida and talks about the specific steps. That gives you a great deal of other information about Florida and the, a lot of interesting information in there and things that will be very helpful to somebody who [00:09:00] wants to become a Florida resident. And it probably would be helpful if you wanted to move to another state to get away from a high-income tax state, but it sounds like Hawaii is a whole lot more mellower**about this than either New York or California, which is where we hear most of the nightmare scenarios come from.
**Don’t assume this to be true. Verify with a qualified professional.
Dan: Really it’s worth, can you imagine, you know, if you had, if you ended up with a situation where you had back years taxes and penalties, how much money you could, you know, how, how little a thousand or two now would look to you in five or 10 years if you can hire an attorney and get it figured out now.
So great advice about getting advice about that. And thanks for sharing that on the book. That’ll help give people. More questions to ask about their specific situation. And it is important if, if someone’s trying to, not everyone’s gonna try to establish a domicile in another state to reduce their state taxes, but if they are, you’re gonna wanna do it.
Reporting Offshore Accounts to USA
Jeff: I think you’ve mentioned this in, [00:10:00] in past videos. But in addition to being concerned about ensuring that you are properly filing returns with whoever you have to file returns with back in the United States, there’s also the issue of when people start establishing bank accounts and other things offshore.
And it’s very important to ensure that you, if you’re gonna remain a US citizen, there’s filing requirements for once you have $10,000 offshore that you have to file every year with the Treasury Department as well as the IRS and the penalties for failing to do that. Are pretty horrendous for, every account that you have, if you have over $10,000 offshore** for every account that you failed to properly report, I believe it’s a $10,000 penalty.
**Check with your lawyer if the $10k reporting requirement is triggered if the sum of all your accounts overseas is $10k USD in other currencies. Plus, these laws change all the time so stay abreast of any changes.
So there are people who’ve been living offshore for years and they say, well, you know, I’ve got my bank account here and wherever it happens to be, be [00:11:00] in the Philippines, Thailand, or Malaysia, whatever. And, ah, they’ve never bothered me before. Yeah. But if they stumble across it and more and more the way things are getting computerized these days, so I, I bring that up only because it’s very important to have proper professional advice and good tax guidance if one is going to live offshore as a US citizen, just to ensure that you don’t have any unpleasant surprises at some point in the future.
Dan: Great point. Yeah, and that’s that not only do they have that set up now, but now there’s a new international law where countries are reporting on each other. When their citizens are in their countries they are opening bank accounts. And I don’t, I don’t know that much about the law, but now the information is starting to be gathered about overseas accounts.
So it is a, it is a valid fear and the penalties are very high. And so if you’re you know, if you have an accountant my accountant sends me out a questionnaire every year, and it’s just a [00:12:00] standard questionnaire. They ask this question, and since I don’t have a foreign account, I, I bank in the US as I explain in my international banking report I don’t have to file those reporting, but a lot of people decide to open foreign bank accounts.
So it’s important information. Thanks for sharing that and,
Jeff: Appreciate Well, well, you’re a gypsy. You’re a gypsy. You don’t spend, that’s what you need next. Is that covered wagon that you just take from place to place?
Dan: Yeah, exactly. It’s if this were a hundred years ago, I would have a covered wagon and I’d be rolling it everywhere.
But, I do actually cross a lot of borders on land and buses and trains and whatnot because it’s cheaper than flying. And often, as you know, I explore a certain part of the world completely before I jump on a jet. And I fly somewhere else. And, so I’m not on these international flights all the time.
I’m more on the ground. Some places you have to fly to [00:13:00] Philippines you know if you’re flying to another continent and that sort of thing. But, mostly I try to stay on the ground. So, I covered wagon wood would be fine for most of it, but unfortunately, it’s only one check bag and one carry-on nowadays.
Jeff: I tend to stay put more in one place or at least one country for a while, so I have been careful when I have accounts like that and I know you differ from me. I, I recently got a Philippine retirement visa just doing that means you have to leave $10,000 behind in the country. So bingo, you’re gonna be reporting that even if you don’t have any other international accounts.
Medicare Supplement May Reimburse Medical Expenses Overseas
Dan: Exactly. Yeah. And it’s, yeah. So another great share. And you also mentioned ear earlier that there’s some A A R P insurance available now. What is it, that was unfamiliar to me? What is it that you’d like to share about overseas insurance?
Jeff: Well, one of the [00:14:00] things that come up, of course, especially when you talk to some of the more mature members that you’re interviewing who happen to be on Medicare such as I am, there are different supplemental policies and the one that I have in a couple of my pals have is the A A R P United Healthcare Policy.
And it’s not the HMO one that they have. They have all the doctors participating. It’s more of the straight insurance type policy and that particular policy, I was surprised to learn after the fact, gives you $50,000 of offshore coverage and it’s a lifetime coverage. It’s not per year, but it’s $50,000 of coverage so that if you have a major health event, Where you happen to be someplace else in the world if you save the bills, you can get reimbursed from the policy.
Even if you’re offshore. It’s not the type of [00:15:00] coverage where they would fly you home for treatment is a completely different thing. But this gives you coverage. So for instance, I just ran into a little heart thing. And when I was over I was returning from Thailand and had it happened in Thailand and had I had a hospital procedure in Thailand, I would’ve had $50,000 of coverage.
I’d have to pay, pay for it while I was there, but I could get it later, and get reimbursed. For the treatment that I received. So if you have viewers or members who are on Medicare, I highly recommend that they check out the A A R P United Healthcare supplemental policy. And by the way, there may be other policies that do this as well, but we’ve all been recommended to this one for the quality of the coverage that we get back in the States.
So if you’re happy with what you have, just find out if they have offshore coverage and if they don’t, you know, you might, if you’re gonna be [00:16:00] spending a lot of time offshore and possibly have a health issue, you, you might wanna look into the A A R P UnitedHealthcare policy. you
Dan: And I think you said that was supplement F as in Frank of AARP United Healthcare supplemental policy?
Jeff: Yes, yes. It’s supplement F as in Frank.
Dan: Okay. And now again, this is another thing we’re, we’re raising an issue and, but you need to talk to, you know, contact the insurer and verify what states it covers if all states, you know, and, and, and, and, and also, Jeff, you mentioned to me that you pay upfront and then they, you submit the bills and they pay you back.
So you need to have a little bit of savings to take advantage of that full $50k USD. But that’s a big deal because over offshore, 50K is not a lot of money in the USA. You might eat that up in a week or two in an emergency room or less maybe. But there are lots of stories where people have had complete treatments for various things, heart disease, [00:17:00] cancer, by going into to one of these tourism medical tourism countries that have, you know, good experiences that they, that you can learn about online.
And the whole bill was less than $50k, whereas if they flew back home, the bill might be quite a bit more, and so $50k is quite a bit of money overseas.
Our Favorite Hospitals and Dentists in SE Asia
Jeff: Well, I was just in, I was in the Philippines for a month at the end of 2022, and then I was in Thailand for a few months in 2023.
And in both places, I wound up having, I had a, a tooth problem and then I had an eye problem. And, I went to a top-shelf eye hospital in the Philippines, and they put me through a very rigorous exam and spent a whole lot of time with me. And the bill was like $250. You know, when I got out, I was, I was shocked.
And then I’d been going to either Bangkok Hospital. Or [00:18:00] Bumrungrad Hospital when I’m in Thailand. Bumrungrad Hospital in Thailand has gotta be one of the top hospitals in the world. And I actually had a tooth extraction and an implant done, which they did at exactly the same time, which kind of surprised me.
I went in for an exam and they said, oh, you need an extraction and an implant. And I said, all right, when do you want to do it? He said, how about now? And I was like, what? So anyway, they, they actually, they’d actually had a couple of other people look at the tooth earlier in the day and they waited for the specialists that evening.
So it wasn’t quite that abrupt, but it was close. And I hadn’t gotten around to eating dinner, and this was around six at night, so I thought I was gonna be able to have some so or something afterward. That was the night when I went to bed without debt, without supper. But anyway, the whole, the whole thing was a third of what would’ve cost me back in the States.
And, and, the care is just, Amazing. Yeah. And you walk in a Bumrungrad Hospital [00:19:00], you feel like you’re in a five-star hotel, you know? And if you’ve been there before Yeah. You know, they’ve got some restaurants there and they’ve got almost anything that you need. And the front desk staff is just incredible.
And the equipment’s incredible. And most of their physicians have trained at the top facilities and are board certified. So it’s not like you’re giving up anything to get care there. And it, it really is fractions of what it would cost back here in USA. In fact, a pal of mine had arthroscopic knee surgery and I think he spent two or three days in the hospital, and I’m sure it was just a few thousand dollars for the whole thing, which, you know, back in the States, forget it.
So it’s. It’s not an unreasonable thing to think about having your care offshore, and if you do have some reserves you can pay for it upfront and you know you’re gonna be covered from your A A R P United, so you’re not gonna lose anything. [00:20:00] But then again, you’re covered with Medicare and A A R P United back in the States and there’s nothing out of pocket.
So that’s a good policy as well. Yeah,
Dan: Exactly. Yeah. So it’s nice, it’s comforting to know though, that if, if you’re somewhere and you don’t wanna jump on a plane to go back to the US for care but you have a little money in the bank to pay for it upfront, you, you don’t have to do that. You can do quicker surgeries and procedures.
And I, I have a similar story I was in when I first left the US it was for work and I was, I was in New New Delhi, India, and I suddenly had a. I had a hard time breathing and I went to the hospital and it took them, it took them a, like a full day, maybe day and a half to find out what was wrong with me, and I was in the hospital.
If my memory serves me, it was five days and they did CAT scans and MRIs, and I had three doctors working on my case. I had a private room with a couch in it so my girlfriend could stay there with me. [00:21:00] They not only had great food at the hospital, but they had menus from restaurants where they would deliver food.
So whatever we felt like eating was there and they were just one-on-one talks with doctors that might last 15, 20 minutes, whereas in the US they would be in and out of your room in 15 seconds or maybe three to five minutes if you’re lucky. And then, the whole thing, five days, including all of the medicine, all of the hospitals, the doctors, everything was around $1600 USD.
Now that’s a decade ago. Maybe it’s double that now. Maybe it’s 3000 or whatever. But at the time I was working and my deductible was 200, so people don’t realize that. And that was the finest hospital in New Delhi, India, which is, may not know it, but it’s one of the, you know, India has a lot of very smart people that do research on top of their field.
So spending more money in the USA is not always better. [00:22:00] And that’s what I’ve found would be the case too. But research, ask.
Jeff: Yeah, well that’s great and especially, you know, if people do a little bit of planning, and clearly most of the people that you interview have done a lot of planning and really looked into things, but just to be able to share this information with them to make their choices a little bit easier, I’m happy to be able to pass along what I’ve, what I’ve collected in my own research.
Dan: Yeah. And I confirm the hospital that you’re referring to in, in Thailand is where, if I’m in Southeast Asia, I go every year for my physical and they do way more testing and stuff than they would in the US and it’s way cheaper. So it’s a lovely hospital, like you said, or, yeah. Yeah. And
And I get my dental done there too. And, I had two failed surgeries in the US on a tooth. And then I, when I was in Thailand, it flared up again and I had it done. Now that’s six or seven years ago, it hasn’t flared up, so maybe the quality can even be better. So you know, really think again about this idea that the world is all in chaos and it’s all safe and perfect in the USA.
Jeff: Well, there’s another place in Bangkok, by the way, called the Bangkok International Dental Center.
Dan: Yeah, that’s the one. That’s the one. Oh, that, that is unbelievable. I love that.
Jeff: I had a crown done there. They’re great. I, I have friends that went there and had whole mouths full of implants, and Yeah. And veneers and all kinds of things done there.
Yeah. And, it’s a fraction of what it costs back in the States and the quality of care. Is exceptional. Absolutely [00:24:00] exceptional.
Dan: Yeah. It’s clean and beautiful and safe and, I just can’t speak more highly of the people really need to think through this. Preconceived notions we have as Americans. It’s, yeah. You know, it takes a little research to make sure that you’re, you know, going to the right spot.
You can ask other expats, what country you’re in, but almost all of these retire cheap countries will have one or two or three hospitals that are on par with the US quality-wise, but their prices are way, way lower, and so that’s something worth.
Jeff: Yeah. Well, I did not expect to find the same level of care in Manila.
As I found it in Bangkok and I was gonna wait to get to Bangkok. When I had this eye, I was getting these floaters in my vision, right? And that’s when I went to this eye hospital, which was a top, top, top eye hospital. So I’m sure you can do fine in Manila. I’m just more familiar with the medical facilities in Bangkok at this point.
But when you’re in these different parts of the [00:25:00] world, I mean they do medical tourism here and they’re not gonna be doing medical tourism and providing crappy care or they’re not gonna be doing medical tourism for long.
Dan: Exactly. Well, Jeff, it’s been a real joy chatting with you and I really appreciate your, come on and share some very important things and thank you audience later, and say hi to everyone and tell us something.
Jeff: It’s my pleasure. And thank you for all of the information that you provide, which was my inspiration during Covid and I’m trying to catch up with you at some point in another part of the world sooner or later, but we keep being in, in the same places at different times. So eventually, eventually we’ll be able to share a beer.
Dan: Yeah. Ships passing in the night, but yeah, let’s do that, Jim. Thanks so much.
Jeff: much. Definitely. Yeah. Take care. Have a great day, Dan. Take care. You too. See you later. Bye-bye.