Black Swan Capital Europe‘s David Bellingham discusses some sound financial advice for American expats in Europe alongside guest Steve Lazar. Geared toward Americans living abroad, a wide range of topics are discussed around the implementation of the 2010 Foreign Account Tax Compliance Act, including:
The Impact of FACTA (Foreign Account Tax Compliance Act)
- All money abroad must be accounted for
- State the maximum amount in each account even if money is just passing through
- If you are “Accidentally American” (US connected people) be aware of your FACTA responsibilities
- Reporting your obligations does NOT mean you will ultimately be taxed on all accounts
Main Points to Consider as an American Living Abroad?
- Report all your income around the world
- When making investments make sure to to the kind that are most compliant with US tax obligations
- Find an advisor who can accomodate US tax reporting requirements properly
- Make it easy on yourself!
The difference between PFIC (Passive Foreign Investment Company) and QEF (Qualified Electing Fund)
- Every investment is a PFIC unless considered otherwise. If it is, then you may pay more tax in the US
Recommendations for Managing Assets Onshore vs Offshore
- Look out for pitfalls like US institutions who do not want to aid you when overseas
- Coordinate your financial team between onshore and offshore compliance and understanding
Other Important Bits of Financial Advice for American Expats in Europe
- Watch exchange rates
- Gains in overseas pension are taxed on an annual basis
- Be aware!
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