Sovereign individuals, people exploring mobility, freedom, international structuring, tax strategy, or Bitcoin often run into a maze of jargon. Much of it sounds familiar, but the meaning shifts depending on legal systems, banks, or jurisdictions. This glossary lays out the essentials in plain language so anyone building a “sovereign individual” toolkit can navigate with clarity.
Citizenship
A legal bond between a person and a country. It defines your rights, duties as a citizen.
Dual citizenship
Being legally recognized as a citizen of two countries at the same time, a status that comes with rights and obligations in both places, and whose practical benefits and duties are highly nuanced and depend heavily on how each jurisdiction applies its rules.
Residence
Where a state considers you to be living for legal purposes. It can differ from citizenship.
Tax residence
Legal status that determines which country has the primary right to tax your income based on where you live or maintain your significant personal and economic ties. It can differ from citizenship and physical residence in some cases.
Passport
A travel document issued by a government proving your identity, used to cross borders.
Residence/Immigration Card
A card showing your legal right to live in a country as a resident.
ID Card
A national identification document used inside a country for verifying identity.
US LLC
A U.S. Limited Liability Company. A flexible business structure often used for domestic and international operations.
Pass-Through Entity
A business where profits “pass through” directly to the owners, who pay tax individually rather than at company level.
Disregarded Entity
A single-member LLC treated as non-separate from its owner for U.S. tax purposes.
Territorial Taxation
A tax system where a country taxes only income earned inside its borders.
IRS
The U.S. Internal Revenue Service, responsible for tax collection and enforcement.
CRS
The Common Reporting Standard. A global system for automatic exchange of financial account information between countries.
Offshore Bank
A bank located outside your country of residence or citizenship, often used for international business or asset diversification.
Bitcoin
A decentralized digital money with no central issuer, enabling borderless and permissionless value transfer.
USDT/USDC
Stablecoins, digital tokens pegged to the U.S. dollar with central issuer.
KYC
Know Your Customer. Mandatory identity verification for financial services.
AML
Anti-Money Laundering regulations aimed at preventing criminal use of financial systems.
RUC
A Paraguayan tax ID number issued to individuals or companies for fiscal purposes.
DNIT
Paraguay’s national tax authority responsible for enforcing tax rules and managing RUC accounts.
Cédula
The Paraguayan national ID card.
Marangatu
The Paraguayan online tax portal where individuals and companies manage their RUC and filings.
Custodial
A service that holds your assets (e.g., crypto) on your behalf.
Non-Custodial
You hold your own keys or control your own assets without an intermediary - no third party.
Skiplagged Flights
A travel tactic where a traveler books a flight with a layover and exits at the layover instead of the final destination.
Proof of Address
A document (utility bill, bank statement, etc.) that shows where you live.
Proof of Funds
Documents demonstrating that you possess sufficient money, often required in banking or immigration.
ECI
Effectively Connected Income. U.S. tax concept for income tied to U.S. business activity.
ETBUS
Engaged in Trade or Business in the United States. A tax classification determining whether U.S. tax rules apply.
Registered Agent
A designated contact in a state who receives legal documents on behalf of a company.
Annual Report
A required state filing that keeps a company active and compliant.
BOI
Beneficial Ownership Information report filed with FinCEN in the U.S. to disclose company ownership.
Virtual Office
A business address service that provides a mailing address without a physical office.
FIAT
Government-issued currency such as USD, EUR, or PYG.
Foreign trust
Legal entity holding assets outside your home country for protection or planning.
Nominee director
A person listed officially for privacy or compliance purposes.
FATCA
Foreign Account Tax Compliance Act. US law requiring foreign institutions to report accounts of US citizens.
DTT
Double Tax Treaty. An agreement between countries to avoid double taxation.
UBO
Ultimate beneficial owner. A person who ultimately controls or benefits from an entity.
Exit tax
Tax levied when giving up citizenship or changing tax residence.
Henley index
Useless metric. Measures of how many countries you can enter visa-free. You never should evaluate second citizenship application based on this index. Very misleading in a bigger picture.
Nomad
Comes from "No Mailing Address" . These days used for traveling while maintaining legal residence or business abroad.
Shelf company
Pre-registered company used to start business quickly.
Trustee / Settlor / Beneficiary
Key roles in a trust structure.
Foundation
Legal entity used for asset protection and estate planning.
Private key / Public key
Cryptographic keys.
Hardware wallet
Device for storing bitcoin offline.
Fiat on-ramp / off-ramp
Converting FIAT currency to bitcoin and vice versa.
Escrow
Third-party holding funds until conditions are met.
Geoarbitrage
Leveraging cost-of-living differences across countries.
Travel hacking
Optimizing flights, visas, and movements for maximum mobility.
OPSEC
Operational Security. Measures to protect personal information and plans from being exposed.
INFOSEC
Information Security. Protection of data, information and digital assets.
PERSEC
Personal Security. Practices to ensure your physical safety.
EDC
Everyday Carry. Essential tools and items you carry daily for preparedness.
Bug-out
Rapid evacuation or relocation in an emergency situation.