Transferring Money to US Fiance before Moving

[amforever 46]

Thanks all! I appreciate the help! My fiance has his interview in 2 weeks, xx 

[Crazy Cat 39,257]

Just now, amforever said:

Well it's more than that. I just didn't want to say the amount just that it is more than that.

I don't see any issues......it isn't income to you.  It's a transfer of his assets.  

[aaron2020 11,651]

1 minute ago, amforever said:

Thanks all! I appreciate the help! My fiance has his interview in 2 weeks, xx 

Best of luck.

[Wuozopo 4,285]

41 minutes ago, amforever said:

My fiance received a gift of savings from his grandad to bring with him to the US. It's over $10k. I'm curious if it is okay to send this amount over? Our plan is to have him wire it from his bank to my bank a few weeks before he leaves, then he will close his account before he leaves. Is there going to be an issue later on with taxes or IRS or Brittish government? It's hard to find any information online regarding this. We are going to have the account joint once he arrives and he is coming on a k1 visa if that helps. Thank you!

Income tax is on money you earn. Money he already has in the UK is his money and would never be classified as his income. He can keep it in the UK or bring it to America without any concern that it is taxable as income.

 

He is gifting the money to you and you are not his spouse (yet). There are tax laws and limits about gifts. See this and figure out what applies.  https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes

 

Because he will be a US taxpayer in the year 2019, then IRS requirements will apply to him and his gifting limits. And I suppose when he files, he will be filing as married so maybe his gift would be considered to his spouse since you will marry in 2019. Just read the details to make sure. 

 

I think I would wait until he has a US account to transfer to himself over gifting to a non spouse.

I still have a UK bank account. I use it to buy gifts on Amazon UK, or transfer money to my kids, or for my UK PayPal account. Makes Christmas and birthday giving and sending much easier. And I use it to rent Air bnb type accommodations easier when we vacation there. 

 

I have transferred sums over $10k to the US using Transferwise. It works well. 

Edited January 10, 2019 by Wuozopo

[amforever 46]

2 minutes ago, Wuozopo said:

Income tax is on money you earn. Money he already has in the UK his money and would never be classified as his income. He can keep it in the UK or bring it to America without any concern that it is taxable as income.

 

He is gifting the money to you and you are not his spouse (yet). There are tax laws and limits about gifts. See this and figure out what applies.  https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes

 

Because he will be a US taxpayer in the year 2019, then IRS requirements will apply to him and his gifting limits. And I suppose when he files, he will be filing as married so maybe his gift would be considered to his spouse since you will marry in 2019. Just read the details to make sure. 

 

I think I would wait until he has a US account to transfer to himself over gifting to a non spouse.

I still have a UK bank account. I use it to buy gifts on Amazon UK, or transfer money to my kids, or for my UK PayPal account. Makes Christmas and birthday giving and sending much easier. And I use it to rent Air bnb type accommodations easier when we vacation there. 

 

I have transferred sums over $10k to the US using Transferwise. It works well. 

Thanks for all the info. I will wait til he is here to transfer the majority of it just to be safe. If we keep his UK bank account open do we report it to the IRS each year, or only if it has a certain amount in it? We will leave it empty after we finish all the transfers, but it could be helpful whenever we go back to visit I suppose. Thanks again!

[aaron2020 11,651]

8 minutes ago, Wuozopo said:

Income tax is on money you earn. Money he already has in the UK is his money and would never be classified as his income. He can keep it in the UK or bring it to America without any concern that it is taxable as income.

 

He is gifting the money to you and you are not his spouse (yet). There are tax laws and limits about gifts. See this and figure out what applies.  https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-gift-taxes

 

Because he will be a US taxpayer in the year 2019, then IRS requirements will apply to him and his gifting limits. And I suppose when he files, he will be filing as married so maybe his gift would be considered to his spouse since you will marry in 2019. Just read the details to make sure. 

 

I think I would wait until he has a US account to transfer to himself over gifting to a non spouse.

I still have a UK bank account. I use it to buy gifts on Amazon UK, or transfer money to my kids, or for my UK PayPal account. Makes Christmas and birthday giving and sending much easier. And I use it to rent Air bnb type accommodations easier when we vacation there. 

 

I have transferred sums over $10k to the US using Transferwise. It works well. 

Just stop.  You should not be giving tax advice.

 

He is not making a gift.  It's his money.  She is the trustee.

 

He's a nonresident until he gets a green card.  There's no gift limits on nonresidents.

5 minutes ago, amforever said:

Thanks for all the info. I will wait til he is here to transfer the majority of it just to be safe. If we keep his UK bank account open do we report it to the IRS each year, or only if it has a certain amount in it? We will leave it empty after we finish all the transfers, but it could be helpful whenever we go back to visit I suppose. Thanks again!

Yes, he would need to report foreign assets.

 

https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar

[Crazy Cat 39,257]

8 minutes ago, amforever said:

Thanks for all the info. I will wait til he is here to transfer the majority of it just to be safe. If we keep his UK bank account open do we report it to the IRS each year, or only if it has a certain amount in it? We will leave it empty after we finish all the transfers, but it could be helpful whenever we go back to visit I suppose. Thanks again!

There are strict reporting requirements for US citizens and US residents who have foreign income and/or foreign assets....There are also specific thresholds involved........I made the wise (I think) decision to hire a very good accountant here in the Dallas area to do all that heavy lifting last year.......I recommend anyone whose spouse has foreign income and/or significant foreign assets to do the same.......there are severe penalties for not reporting foreign assets.

[Wuozopo 4,285]

Just now, amforever said:

Thanks for all the info. I will wait til he is here to transfer the majority of it just to be safe. If we keep his UK bank account open do we report it to the IRS each year, or only if it has a certain amount in it? We will leave it empty after we finish all the transfers, but it could be helpful whenever we go back to visit I suppose. Thanks again!

You do not report money in the bank as income. If the account pays interest to him, then the new interest earned in that tax year is income just like if you earn any interest from your saving accounts or investment accounts. My UK account pays me nothing so I report nothing to the IRS.

 

There is a form to report to the Treasury Dept each year if you have foreign accounts exceeding $10k. It is commonly called FBAR. It is strictly a report saying name/address of bank, account number, and highest balance anytime during the calendar year. You fill it in online. You pay nothing. It is strictly a report. Your finance will have more than $10k in a foreign account during 2019 so he will do the report at least once. It will be due by April 2020 to report 2019. Even if at the end of 2019 he has moved most of the money out or even closed his foreign account, he still had over $10k at some point in 2019.

 

It is really a nothing to do. I do it every year. Link to info https://www.fincen.gov/report-foreign-bank-and-financial-accounts

 

[amforever 46]

I'll probably consult with a tax lawyer to be safe. I'm getting a bit confused...

[Wuozopo 4,285]

11 minutes ago, aaron2020 said:

Just stop.  You should not be giving tax advice.

 

He is not making a gift.  It's his money.  She is the trustee.

When he transfers a large sum of money from his name to a bank account that does not bear his name, he is gifting. I am not giving advice. I provided a link to the IRS so she can educate herself and see how and if it fits her circumstances. 

[aaron2020 11,651]

10 minutes ago, Wuozopo said:

When he transfers a large sum of money from his name to a bank account that does not bear his name, he is gifting. I am not giving advice. I provided a link to the IRS so she can educate herself and see how and if it fits her circumstances. 

It's not a gift.  Stop insisting that it's a gift.

 

If she is temporarily holding onto the money for him in her account, then he never made a gift.  She is simply a trustee.

 

If he loans her the money by putting money into her account and she repays the loan, then it's not a gift.

Not every transfer into another person's account that doesn't bear his name is a gift.  

 

He intends to take the money back, so at no time would he be making a gift.

Edited January 10, 2019 by aaron2020

[Reggie B 11]

When I moved over, my fiance opened a new account in her name and all my savings went in there until I could open my own account. 

 

There was no tax issues or awkward questions about this at my GC interview. 

 

I would also recommend transferwise for sending over money, it’s what I used. 

[thatguyuknow 147]

Do you need the money to be immediately available to use in USD? Right now the exchange rate is horrendous. If you dont and it's a decent amount it maybe worth while leaving it in GBP? If we have another Brexit vote and remain in the EU the pound will come good. 

 

Just something to bear in mind