|FAWCO US Tax & Banking Bulletin FALL 2013
Margaret Nelson Spethmann
US Tax & Banking Chair
|FAWCO is helping to collect information & spread the word on
TAX & BANKING
issues for US Citizens abroad & their families
FATCA impacts on Saving, Investing & Financial Planning in Crossborder Context plus new IRS TAX links,
Updates on DC Advocacy,
Note our Disclaimer at the bottom of this mail, but please feel free to forward this Bulletin to friends who can use the information!
BANKING issues: Chasing a moving Target! Many of you have asked for help finding banks that still service US tax persons overseas. In this issue, we publish our most recent info on where you can still go, but we want to extend & update this list worldwide .We are starting to receive more emails about banks giving only 3 weeks notice for withdrawing investments from their institutions. Let us know if your bank has done this to you or let us know where it is still possible to bank and invest.
Please look for and participate in our FAWCO Financial Services survey coming out later this month!
See also our links in the special section below for financial planning help for US persons living abroad.
Members: If you are not a FAWCO Club President or FAWCO Rep, you must subscribe to receive this in the future. SUBSCRIBE HERE(you will be asked to log in).
Visitors: click here if you are a visitor and want to subscribe.
We hope you find lots of helpful info & links here to guide you through these important issues. Let us know what else you need !
IRS Tax Map & Topic Index for
(new as of September 2013)
The IRS is trying to make our life easier ! This is good news. They have been listening to FAWCO and other overseas Americans' suggestions.
'U.S. taxpayers living abroad with international tax questions can now use the IRS Tax Map online to get answers. Tax Map assembles (or groups) IRS forms, publications, and web pages by subject and provides users with a single entry point to find tax information.
In September 2013, the Tax Map was created with Individual overseas filers in mind, to help us find the forms and explanations we need to file from overseas.
Want to know what impact a government shutdown or sequestration might have on filing deadlines, penalties, and audits etc? click here
Here are a few links for 2013 Year End Tax Planning:
To do list click here
2013 Tax Planning guide click here
See FAWCO Platinum Sponsor US Tax & Financial Services' website for their list of what planning can still be done in 2013 click here and their take on tax changes that may effect you in 2013 and 2014 click here.
|TAX: New IRS webpages !
(IRS calls us 'International Taxpayers' ) for basic info, click here.
US Citizens and Non Resident Alien can find helpful info, so check these links & forms
File, even if you don't owe taxes ?
Did you know that US ' tax persons' and citizens are subject to tax and may have to file US tax information forms even if they have no earned income, already pay taxes in their country of residence, are below the foreign earned income exclusion, and/or give money away? You also may have to file an information form if you receive a gift of money or inheritance from a foreign citizen or corporation.Thresholds for non filers are very low, so check before you assume you don't have to file paperwork in the US! click here
FBARs & 8938 'Information' Forms
Most US tax persons, regardless of where they live and if they owe tax, must file Information forms on financial accounts and assets they hold in foreign countries. Important enough to repeat: 'regardless of whether or not they owe tax to the US government'.
|BANKING, INVESTING & FATCA!
Many of our members and some Clubs have been finding it increasingly difficult to maintain existing, or open new, bank, brokerage and other financial accounts both abroad AND, increasingly also, in the US.
Recently we have heard that several US institutions are more aggressively cancelling relationships with US persons who have a non US address. In some cases, the banks have gone so far as to dissolve tax advantaged retirement accounts without instructions from the client. A number of US banks are refusing new accounts from citizens overseas.
WHY IS THIS ?
Most European countries have now signed special tax information sharing agreements with the US, so information exchange between governments will be the fact of the future.
As many of you already know, new FATCA regulations and increased US IRS assertiveness have raised risk and compliance costs for foreign financial institutions (FFIs). The Treasury has tried to resolve this in the final FATCA guidelines and some IGAs (Intergovernmental Agreements), by requiring compliant FFIs to prove they do DO NOT discriminate against US citizen clients. It is likely that this will not completely alleviate the situation since many firms have not finished reading the new rules, have decided the process is too expensive to maintain US client accounts, overseas banks do not want the hassles of registering with the SEC, and so on.
Read FAWCO's most recent presentation on this topic here and
participate in our Financial Services Survey coming soon.
See other links to basic FATCA Info & IRS FATCA pages & media articles in the side bar to the right.
FAWCO SURVEYS BANKING PROBLEMS!
FAWCO continues to collect information on which banks and foreign financial institutions are accepting US citizens abroad and which have discontinued servicing us. Many banks are only accepting accounts from wealthy individuals or prior clients with significant assets. We are trying to sort out these differences by the end of this year. In order to publish an updated bank list of financial institutions around the world which still welcome US persons as clients, we need your help! Please share what you have learned. Do you have banking relationships and investment firms that you work with easily? Please take our anonymous survey that comes out in December. Help us collect detailed info on what works, where and names of financial institutions for our members who are having difficulties. Take our survey coming in December.
Click here for ACA recommendations to see how to proceed with stateside US banking problems.
International Family Financial Planning
Saving, Investing & Financial Planning in
As if the tax filing wasn't enough, how can I save and invest my savings? How can I be sure I will have what I need to retire?
How can I feel safe as an expatriate housewife?
How can I prevent everything from being eaten up by advisory fees and multi-country taxation?
The Tax & Banking committee has been looking for specialized financial planning resources and professionals to help US tax persons in our cross-border situations. While we cannot specifically recommend these companies, we did find that they had helpful articles on their websites which may help you think through these important issues.
2013 post financial cliff financial planning tips ( not just for Swiss residents), click here.
General tax planning 2013 year end suggestions, click here.
More on planning opportunities, click here.
Basic Info & Strategy
A Financial Guide for the American Expatriate, click here.
Basic Info: Three ways to manage your money, click here.
Financial Planning Presentation on Investment Tax Strategy for Overseas US Tax Persons, click here.
More on Financial Planning for US Persons Overseas, click here.
Why No Foreign Mutual Funds, click here.
Retirement Issues(in some cases country specific)
Basic Definitions/ Instruments re Retirement Savings, click here.
Advantages of IRA vs State Tax living overseas, click here.
IRA Rules for American Expatriates, click here.
Individual Retirement Accounts and US Deferred Compensation Programs in Transatlantic Cases, click here.
UK Pension issues for US Tax Persons, click here.
Helpful articles on UK/US taxation of pensions, click here.
Can A Foreign spouse receive Survivor Social Security? Click here.
Foreign Retirement Accounts & IGAs
Unfortunately the US continues to tax many savings vehicles used by foreign retirement accounts disadvantageously (PFIC rules). We are working on raising awareness of this unfair practice in Washington. In some of the recently negotiated Intergovernmental Agreements, like in Switzerland, many foreign retirement programs are exempted from FATCA reporting. In some, but not all, countries some form of similar treatment clause has already been incorporated into the Intergovernmental Agreement ( IGAs) negotiations for 'qualified' plans. Ask your tax adviser if your plan 'qualifies' under the IGA for tax deferred/ advantaged treatment.
For helpful IRS info and links re Foreign Retirement Plans,
Tax Traps of Transfering Pensions
Getting the Right Advice Paramount!
Qrops-USA- Difficult & Complicated
Links to Recent Media articles:
CNN Money article: US Expat tax
Pitfalls of Paradise:Retiring Abroad
The Consequences of Working Abroad:
Social Security & Obamacare Taxes
While ACA has advocated in DC that ObamaCare taxes should not apply to Overseas US persons who pay into another country's social security system, in general, US Social Security and Medicare taxes still apply to what you earn for services performed as an employee or independent contractor outside the US. When do they apply? Click here for the IRS link.Our Sponsor, US TAX & FINANCIAL SERVICES, has an updated overview to help you assess when Obama care will add to your taxes as an Overseas American here. Our sister Organisation ACA has posted that this is not the case, but tax advisors are urging caution on this issue.
Estate Planning in Crossborder Context
SENSITIVE CONVERSATIONS: WHEN TO TALK ABOUT IT?
Summer vacation, along with Thanksgiving and Christmas holidays, are times for family gatherings and sometimes the only times in the year when we see our parents and siblings, aunts and uncles. Often it is a challenge to get young adult children all in one place even for a week or so in the summer, or several days over the holidays...
...So many of us use the summer or after Christmas to discuss 'big, unpleasant topics' with spouses and family members.
Even when you have pies to make,
how can you make it pleasant to talk about important subjects like,
death and taxes, finances and saving
when most people would rather be at the beach, or sailing or hanging out by the pool, or out Christmas shopping and seeing their friends ?
Send us your suggestions on best strategies for having these conversations, so that we can share them with others!
New Links to Basic
Estate & Gift Planning
for Overseas Americans
Did you know in some countries it makes a difference if you pay for a Child's US college expenses from a US based vs a foreign account? In some countries ( like Germany), paying from the US can trigger gift taxes in that country!
For a introductory explanation of US estate and gift tax click here and also see IRS Publication 950 for their full introduction to US Estate & Gift Tax rules.
Do you have a will? In which country? Do you need one in both/several?For some examples of why you might need to consider these options. Click here
FAWCO's Tax & Banking Committee has asked some experts to share what they know with us. As always, our disclaimer at the bottom of this newsletter applies. Seek professional advice before making changes to your plans. We provide access to the following presentations as a public service to help educate Overseas Americans on these issues.
This Presentation discusses consequences of the US Taxpayer Relief Act 2012 and its impact on trust and estate planning.
What to do if someone dies owning an undeclared offshore account?
This Presentation gives a good overview of what Swiss residents will need to do, but the points it raises may also be helpful in thinking through what is necessary where you live.
These presentations explain many aspects of German-US Gift & Estate Planning including impacts of the IGA ( Inter Governmental Agreement),
click here and click here.
UK /GER Tax Planning, click here.
This presentation explains many new aspects of UK taxation ( UK Finance Act of 2013) on Non Domiciles and foreign ( non UK citizen) private clients, click here.
This site gives easily understandable specifics of Estate and Inheritance laws by country. Click here for the example from Germany.
ALWAYS consult professional advisors in both US and the jurisdiction in which you live before finalizing wills or trust documents. This can save costly mistakes !
Review our Laundry List of items needed in discussions with Estate Planning and Tax advisers. Having these things on hand ahead of your meetings will help you prepare and save their having to ask for them.
Click here for the complete List.
Looking for help? Here is the Link to the Society of Trust and Estate Practitioners.
|D.C. Advocacy Update 2013
The FAWCO Tax & Banking Committee represents you in Washington! In February,together with the FAWCO Washington Liason Lucy Laederich, ARRO & ACA, we reached out to over 80 Congressional off ices to explain the onerous impact of some US legislation and regulations on our lives as overseas Americans.
In April, the T&B Committee drafted a letter of comments for the FAWCO Board to send to the House Ways and Means Committee(HWM) & Financial Services Committee(FSC). To see the FAWCO Board letters sent to the House Ways and Means committee, click here or to the House Financial Services Committee, click here. Some of these comments are reflected in the summaries that the Joint Committee on Taxation produced this summer, but we have a lot more advocacy and education to do in Washington if we are to insure that the burden of compliance on overseas Americans is significantly reduced.
This summer ACA proposed easing filing for International taxpayers. Read American Citizens Abroad's Comprehensive Compliance Program Proposal, click here. ACA has also requested in Washington that Americans abroad receive credit for the new 3.8% Affordable Care Act tax on capital gains. See their web site for more information on this or check out the tax planning links in the side bar to the right.
Write your Reps in Congress !
You can help us get better representation and our voices better heard in Washington!
1. Participate in our anonymous financial services survey. We will aggregate the information to help us educate Congress about the impact they are having on our financial lives while we live overseas. Stay tuned for more information.
2. Write your Congressmen and Senators to tell them how much time and money you have to spend to get your US tax compliance done. Let them know if you are having banking difficulties because you live overseas!
3.There is a bill (HR6263) proposed to study the impact of US legislation on Americans living overseas. FAWCO supports the establishment of this Commmision! Help get it passed.
See the US Liason FAWCO Pages for more information
direct link to the page on this issue
and links on how to write your Representatives to support HR6263.
What is HR6263 ?? click here
For tips on how to write your Representives in DC click here
| In this Issue:
Banking, Saving, Investing Pittfalls and Tips - while living overseas
Financial Planning: Basics & Links
to Specialist Advisors
Special considerations re Retirement Accounts while Living & Working Overseas
Inheritance Tax Implications for Residents of Foreign Countries - new links and
Estate Planning in Cross-border context
Update on DC Advocacy
Basic FATCA Info
to New IRS webpages
Results of FAWCO's Financial Services Survey
Tax Updates & Filing Deadlines for Overseas Americans
More Banking Updates
Expanded Lists of Specialist Advisers
Tips & News for Protecting Seniors from Scams
There is a dangerous new Scam. People are calling impersonating IRS officers & putting immediate payment pressure on their victims. Don't get caught. Don't let your parents or children get caught. Don't give out private information! and don't pay unless you are sure you owe.
read more here
WHAT IS FATCA?
Foreign Account Taxation Compliance Act
Here are some basic links to FATCA articles & definitions:
IRS FATCA pages info on IGAs click here
Good explanation & basic definitions click here
A bank's perspective on what they will now require of clients to maintain accounts
Thun Financial on what expats need to know re FATCA click here
Recent professional updatesclick here and here
several media articles & commentaries:
click here and here
ponderous pond straddling
loopy tax rules
what brit biz pays FATCA
cnn money: us expat tax
BNYMellon to the rescue?
|Helpful Links to
How to deal with States side banking problems
?s for Potential New Bankers
See our most recent presentation here for our most current suggestions re where you can bank.
cnnmoney banks lock out americans
A word about us...
Help Wanted !
The FAWCO TAX & BANKING Committee is looking for more volunteers from Member Clubs living in a variety of countries to assist us in gathering information for these web pages.
1. editor to insert periodic corrections to existing web pages
2.Researcher for legal issues of family law
3. Contributors of specific info in many locations around the world
If you are interested in joining our team, please email us stating which Club you belong to, what areas you want to work on and how much time you have to give.
We look forward to your help!
Email us at ustaxbanking
Join Our Mailing List!
| This is a no-reply message for FAWCO U.S. Tax & Banking Subscribers.
The Purpose of this Bulletin is to inform, share and explain US reporting needs and banking and legal constraints to US citizens abroad. This is NOT individualized, professional tax, legal or banking advice for your particular situation. While we make every effort to keep the information here current and accurate, neither FAWCO, nor the authors accept personal liability for accuracy, content, mistakes of interpretation, omissions, or later changes to the law or policies, as well as for viruses or any other damage you may sustain.A ny advice you may obtain herein is not intended, or written to be used and cannot be used to avoid tax, or tax penalites or other legal obligations, or promoting, marketing or recommending to any other party any transaction or matter described herein.
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