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Matthias Knab, Opalesque for New Managers: A Cayman Islands resident who renounced his U.S. citizenship has been sentenced to 37 months in prison for tax evasion, the U.S. Department of Justice announced.
According to court documents and statements made in court, Justin Ryan Schmidt, formerly of Austin, Texas, managed a hedge fund focused on cryptocurrency investments. Over several years, Schmidt earned at least $7 million from the fund but failed to report any of this income on his 2020, 2021 or 2022 tax returns, instead falsely reporting income of $5,000 or less in each of those years. At the same time, he held millions of dollars in undisclosed foreign bank accounts.
Schmidt renounced his U.S. citizenship in March 2022. Individuals who expatriate from the United States are required to report certain information to the IRS regarding their net worth, income, assets, and liabilities as of the date of expatriation. Schmidt filed a false expatriation statement claiming a net worth of $25,000, despite knowing his net worth at the time exceeded $2 million. He also falsely stated that he had complied with his tax obligations for the preceding five years.
In 2023, Schmidt paid approximately $5.8 million to purchase a house in Snowmass Village, Colorado, and sold it three months later for approximately $9 million. He had a duty to report the U.S.-sourced gain but did not, and evaded t...................... To view our full article Click here
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