Good faith Marriage..

[walran 24]

Yes, US residents are taxed on worldwide income but only US residents are taxed on foreign earned income while living abroad ( well Eritrea too). So if we move to Nepal in 5-10 years as would seem likely I don't want to have anything tying me to a business there as whatever is in her name in Nepal would not be taxed in the US if she is no longer a resident.

I have lived abroad for better part of 10 years and see this as a major issue from my friends who have done similar things in Europe etc. My friends that just returned from Switzerland said that with FATCA they couldn't get even a bank account there or in Germany if anyone of US citizenship was part of the account. Mine in Germany and Spain were cancelled thanks to Fatca.

The US tax system scares the ####### out of me and filing separately for a lesser tax burden seems to be smart. ( she volunteers for a charity so currently not an issue) Additionally we don't really care about getting citizenship for her and she is against it so just a green card for 5-10 years and then out to live abroad and work for a charity is our mutual plan.

The US has some wonderful infrastructure, ease of income, security, and other things about it but I/we are not sold on permanently staying here especially when you money goes so far elsewhere.. SHe never wants to give up her citizenship and Nepal will not recognize dual citizenship. With the new exit tax seems like it might be good to have assets building in the name of the foreign national abroad? Real estate for example in Kathmandu is roughly on par with Utah in the USA and her building is about 600-700K usd. And the prices are going up each year.

I feel blessed to have this option available to us to live here and then move and have economic options abroad (while I know I will pay taxes in the US for life)..

We have lots of pictures ( facebook) and insurance is in both our names on vehicles etc. and CC I guess would seem to be what we will go with. I will also put her name on a house as well with me and the utilities.

It's just that at 53 I have to start looking for the end game if I ever want to retire and pursue a life of charitable service abroad as has been my dream for many years. Usha is a Dr. and 35 and shares that same focus fortunately.

Best Wishes to all in this sometimes confusing process. I have helped several friends through it in the past and now I get to feel the pain first hand I guess

[walran 24]

How are you filing taxes now? What is your tax filing status? If you are married it's Married Filing Jointly, Married Filing Separately or Head of Household if you have a qualifying dependent.

Married filing separately though she doesn't need to file currently as she has no income herself as her work is pro-bono for a charity.

Yeah, if she's a resident she has to pay all taxes just like you. Are you willing to risk everything so you can evade taxes?

Tax avoidance is legal... tax evasion isn't.. and yes to the first on avoidance as we could easily live abroad even now.

[walran 24]

Walran, if she has a business in Nepal, she still has to declare any income she makes on a US Tax return. I can fully understand if you want to file your taxes separately if she will be in a low tax bracket and you will be in a high one. But check with an accountant first - as the marriage deduction (filing jointly) might be more beneficial.

As others have said - it's OK to look "different" from most couples, but you will need to explain to USCIS why and how you keep your money separate.

From your original post, which, granted, is lean on details, it SEEMS as if you might be forgetting that any Nepali income must be declared. There might not be any actual tax liability (if the US has a good tax treaty with Nepal), but be mindful that the APPEARANCE of trying to avoid US tax might hurt you.

Best of luck.

Sukie in NY (who has to declare income in Australia and Hong Kong, as well as the US)

Sukie, very helpful as you are actually going through this. She has assets currently in Nepal and we are looking to mount a business there hopefully next year or two in her name legally and fully compliant with all US and Nepali tax laws.

I am all for paying my legal taxes but when we move overseas as I have done before I prefer to have her separate from myself (unless I can see a benefit) as her earnings will be far less and taxed at less than 20% in Nepal and if it is in both our names etc. then she could end up with a 40%+ hit on those earnings..

Taxes are insanely high in the US with corporate taxes the highest in the world.. If you are a EU W2 type employee then they are very high there too but if you are a business owner then they are much much lower. I regularly do business with foreigners who say do anything to avoid (avoidance is legal) the US tax system as it amounts to financial rape and red tape beyond imagining where you can hardly open an account overseas anymore ( post FATCA).

Not sure what the next five years will bring but as for now the plan is to move in five to Asia, do charity work and work with slum children. Rental income here and passive assets and her business there can amply support us The insanity of the US system and all the paperwork, regulations and other misc stress is killing me.. Read a Huff post that tens of thousands of business people in the US in my shoes are giving up citizenship mainly for tax issues.. Romney and other associates have moved their corporations outside the US. Not sure I am there yet but could be after a few more years if things don't change and my business grows.

One creative CPA suggested buying property there or abroad, exchanging up via 1031 exchanges and then after renting it out for a couple of years moving into it for at least 2 in five years where we could then sell it for a $500,000 profit paying no taxes and no recouping of depreciation. Will have to look into that.

My friend Richard and his wife Marie have gone through this as she is from the UK and they say it is a nightmare filing and so hard to find competent tax advisers that it is insane if you aren't Trump's size and status. Co-mingling only makes it harder according to them as he supports her here ( and she has to claim his income for some reason by UK law).

I am not like most people here from the pictures I am much older and at a different life stage, in the end game as it were so I think I will look at it all differently than most.

Love this country, have been in her army, and am 3rd generation on dad's side and 7th on mom's.. But I love my wife even more and would follow her to the ends of the earth to be together and I really just want to live a life in service abroad where I feel I can do the most good. Without the stress killing me wondering if the taxes are done correctly back home while I am living the dream.. Fortunately she feels the same.

[TBoneTX 43,048]

Thread is moved from the Effects of Major Changes forum to the Tax & Finances forum.

[SunflowerSweet 1,321]

They were married April 2016 according to their timeline

And are now starting a new business

going to be hard not to declare this income

I can not imagine that you would not comingle assests as this is needed for AOS and later for here citzenship

Any money received by your bank from the new business will be looked at when you do forms for AOS

Is this a trust issue?

or just trying to avoid paying taxes?

don't answer / just know immigration does not like the first and IRS does not like the second

They shouldn't need comingled assets for AOS. That's for ROC down the line.

[tuckin14 58]

If you are a legal permanent resident of the USA, you must pay taxes in the USA on your worldwide income. I knew a Canadian who was married to an American but he lived and worked in Bermuda, and he chose not to get USA residency to avoid paying USA taxes. But he was making a lot of money and she wasn't making much.

So if she wants to get her green card, she's going to have to pay taxes here.

There's something else you're missing. A couple's combined tax liability is almost never higher if they file separately. By filing jointly, you would in effect be moving some of your income from higher brackets into her lower brackets. The only times I've generally seen couples (who have adequate advice) file separately is when they are divorcing and don't trust each other, and when one has very large medical bills (because of a quirk in itemized deductions).

Because of all this, if you go to USCIS and argue that you didn't co-mingle for tax reasons, it will sound very hokey, because you can't validly save much on taxes by filing separately.

But is this AOS or ROC?

[walran 24]

If you are a legal permanent resident of the USA, you must pay taxes in the USA on your worldwide income. I knew a Canadian who was married to an American but he lived and worked in Bermuda, and he chose not to get USA residency to avoid paying USA taxes. But he was making a lot of money and she wasn't making much.

So if she wants to get her green card, she's going to have to pay taxes here.

There's something else you're missing. A couple's combined tax liability is almost never higher if they file separately. By filing jointly, you would in effect be moving some of your income from higher brackets into her lower brackets. The only times I've generally seen couples (who have adequate advice) file separately is when they are divorcing and don't trust each other, and when one has very large medical bills (because of a quirk in itemized deductions).

Because of all this, if you go to USCIS and argue that you didn't co-mingle for tax reasons, it will sound very hokey, because you can't validly save much on taxes by filing separately.

But is this AOS or ROC?

From what I can see it looks like from the tax standpoint it would mean an increase of about $5,000 a year in taxes. It becomes more pronounced apparently as you have higher incomes.. I need to check with a competent attorney as I am more concerned about the ramifications going forward as we leave the US and work in "her" business abroad. She is currently an MD but we will mount a business in Nepal in the next couple of years.

Citizenship for her is not important to us at this time at all (until Nepal recognizes dual citizenship) but an ability to travel to and from the US at will is. I suppose we will pass each hurdle as we come to it. I am blessed beyond measure and give thanks to God every day for my good fortune in finding a wonderful wife and having her here with me..!