IL Postcard

No Pension? Not Yet 50? Don't Have 200k? The Visa Options in Panama

Date: 07/12/2007

Editor's Note: News about changes to Panama's tourist visa policy have sparked discussion about how to obtain a residency visa. International Living's Latin America Editorial Director, Suzan Haskins, offers suggestions here.

We've told you about changes the Panama government has made to its tourist visa policy. Instead of allowing tourists to stay in the country on a tourist visa for 90 days, only 30 days­ are now allowed-with a possible 60-day extension.

We also mentioned the two most popular ways to obtain a residency visa in Panama -the pensionado visa, which requires that you receive a pension of at least $500/month from a verifiable private or government source -and the "person of means" visa. The "person of means" visa requires that you invest at least $200,000 in a two-year fixed-term deposit in a national bank CD and/or property in Panama.

There is currently some controversy swirling about Panama regarding the fact that the property you purchase under this latter option must be in your personal name and not in the name of a foundation or corporation. That's because although Panama is one of the very few countries in the world that has never signed any sort of Tax Information Exchange Agreement (TIEA) or tax treaty, anyone can visit the local title registry and find your name and the price paid for your property.

It is important to point out here that if you have nothing to hide, you have nothing to fear -and I understand the viewpoint of those who believe otherwise, so please don't feel the need to write me about that. But if you want to obtain a resident visa in Panama under the "person of means" process, you should be aware of this rule.

And all is not lost. There are other ways to qualify for a resident visa in Panama, and one in particular is a less-expensive option than those mentioned so far -unless, of course, you are lucky enough to qualify for a pension.

An alternative: You can obtain a resident visa by becoming either a small forestry investor or a large forestry investor with a minimum approved reforested land purchase of $40,000 or $80,000, respectively. There is, of course, some risk with this option -and there can also be potentially high gains.

The difference between the two options? Small forestry investors are allowed to stay in Panama with one-year renewable immigrant visas and must apply for permanent residency on their fifth year. Then they are allowed to apply for citizenship if they wish. Large forestry investors are allowed to apply for permanent residency immediately after the first immigrant visa card expires, and may apply for citizenship five years after their initial application.

And good news: you can now use your IRA funds to invest in forestry projects in Panama and qualify for forestry investor visas. You can also use IRA funds to invest in other types of Panama real estate, but this will not qualify you for a resident visa, because when you buy with an IRA the property must be owned by a corporation or foundation owned by the IRA and not in your personal name. The government of Panama will, however issue resident visas for those who use IRA funds to invest in forestry projects, as in this case it accepts the fact that you own the land through a corporation.

Keep in mind, that both the person of means visa and the large forestry investor visa are immigrant visas. If your application is accepted, you will receive a provisional one-year visa. At the end of the year, you must file a petition for permanent residence. Five years later, you can apply for Panamanian citizenship if you comply with the requirements for this. But know going in that the citizenship process can be very lengthy, as immigration receives many such petitions.

For more information about the forestry investor visa, contact Robert Kroesen of United Nature ( website: www.unitednature.com) atRobert@unitednature.com . For information about using your IRA to invest in Panama -either in a forestry project or in real estate, contact Rich Luchsinger of Sovereign International Asset Management (website: www.worldwideplanning.com ) at rluchsinger@worldwideplanning.com. For information about general immigration issues, contact attorney Rainelda Mata-Kelly at rmk@mata-kelly.com.

Regards,

Suzan Haskins
For International Living

P.S. International Living is as keen on Panama as ever. The incentives there still far outweigh any affects of any recent governmental policy changes. We expect a full house for our upcoming Live and Prosper in Panama Seminar, August 2-4, and you can expect that all these issues and more will be addressed -by the Panama experts who can tell you just how much this country has to offer, and why making a move to Panama now makes so much sense. This is your chance to find out all you need to know to determine if Panama is right for you.