US spouse has student debt. If I move there, am I liable?

[SCOREAU 36]

13 minutes ago, Boiler said:

I appreciate that, how the US treats it as the US taxes you on your worldwide income, now there are credits etc but like I say it is complicated.

I am only too aware of possible complications. HMRC said I should be okay, but I know that IRS are difficult to deal with, and might be an issue., based on stuff I've read. I haven't really researched that aspect, but merely felt safe in the knowledge that my pensions will have already been taxed at source by the UK government. Any lump sumsvI have, as part of my tax free pensions allowance are only what I'm entitled to under uk law. I'm not sure where we stand with the money from the house and taxation, and wouldn't want to be in a scenario where they would be taxing me on that as well! I'd rather leave it in uk if that was the case. Advice on that aspect would ve very welcome.

[Villanelle 4,121]

34 minutes ago, SCOREAU said:

I am only too aware of possible complications. HMRC said I should be okay, but I know that IRS are difficult to deal with, and might be an issue., based on stuff I've read. I haven't really researched that aspect, but merely felt safe in the knowledge that my pensions will have already been taxed at source by the UK government. Any lump sumsvI have, as part of my tax free pensions allowance are only what I'm entitled to under uk law. I'm not sure where we stand with the money from the house and taxation, and wouldn't want to be in a scenario where they would be taxing me on that as well! I'd rather leave it in uk if that was the case. Advice on that aspect would ve very welcome.

Generally there are treaties where if one country is taxing you the other one wont. You should contact a local CPA to where you intend to live to discuss it. Not all are knowledgeable about foreign tax issues so shop around until you find one that is. It may cost you several hundred dollars to file the first few years (the first year is done a certain way and then subsequent years differently) but then after that you should be able to copy what they did and fill out the forms yourself. There are tax threads on VJ but again taxes are complicated and everyone has a different situation so its hard to help others with that. 

[US-UK 32]

As a caution on the US/UK tax issues:  We ended up with US tax liability on selling our house in Europe and paying off the mortgage due to currency fluctuation creating a taxable gain. Also be careful if you have things like UK trusts (which must be reported and may be taxed in the US) or decide to rent out your UK home instead of selling (which requires non-resident landlord paperwork and an annual HMRC self-assessment).

 

You will be well served (but potentially shocked at the cost) to engage a very good tax consultancy with both UK and US experts on staff. 

[SCOREAU 36]

1 hour ago, US-UK said:

As a caution on the US/UK tax issues:  We ended up with US tax liability on selling our house in Europe and paying off the mortgage due to currency fluctuation creating a taxable gain. Also be careful if you have things like UK trusts (which must be reported and may be taxed in the US) or decide to rent out your UK home instead of selling (which requires non-resident landlord paperwork and an annual HMRC self-assessment).

 

You will be well served (but potentially shocked at the cost) to engage a very good tax consultancy with both UK and US experts on staff. 

The property is in my name. I'd just leave the money in a uk bank account, then.? I won't be wanting to paying tax on it.

[SCOREAU 36]

6 minutes ago, SCOREAU said:

The property is in my name. I'd just leave the money in a uk bank account, then.? I won't be wanting to paying tax on it.

So, here I don't get taxed but there I would on my house sale? It gets worse by the hour!

[Lemonslice 4,555]

4 minutes ago, SCOREAU said:

So, here I don't get taxed but there I would on my house sale? It gets worse by the hour!

It is more complicated than that - a consult to the right accountants might be worth it.  

[US-UK 32]

Where the proceeds sit is immaterial. If you are a US tax resident at the time of sale, the sale is a US taxable event.   

 

Talk to tax professionals before you move to maximize your tax efficiency now and to understand what accounts, in what order, in what amounts you should pull from in the future.

 

We are lucky that our employers pay most of the bill to have our US, UK and EU taxes prepared by large firms with global expertise. But the planning advice (x2 hourly rates to have both the US and UK advisors on our calls), and the “unusual circumstances” that our companies won’t cover (like declaring the UK trust to the IRS), routinely cost us a several thousand dollars out of pocket each year. 

[SCOREAU 36]

On 6/19/2019 at 5:12 AM, US-UK said:

Where the proceeds sit is immaterial. If you are a US tax resident at the time of sale, the sale is a US taxable event.   

 

Talk to tax professionals before you move to maximize your tax efficiency now and to understand what accounts, in what order, in what amounts you should pull from in the future.

 

We are lucky that our employers pay most of the bill to have our US, UK and EU taxes prepared by large firms with global expertise. But the planning advice (x2 hourly rates to have both the US and UK advisors on our calls), and the “unusual circumstances” that our companies won’t cover (like declaring the UK trust to the IRS), routinely cost us a several thousand dollars out of pocket each year. 

But if I leave the majority of my savings in uk, how will they know? It's all getting worse by the minute. I don't want to move there and be shafted tax-wise when I could remain here and not be charged on the money gained through a house purchase. I probably see it all too simply, but employing tax professionals and all that isn't my idea of chilling out in the usa and having a quiet life with just the labours of 36 years of work under my belt.

Edited June 20, 2019 by SCOREAU

[SCOREAU 36]

8 minutes ago, SCOREAU said:

But if I leave the majority of my savings in uk, how will they know? It's all getting worse by the minute. I don't want to move there and be shafted tax-wise when I could remain here and not be charged on the money gained through a house purchase. I probably see it all too simply, but employing tax professionals and all that isn't my idea of chilling out in the usa and having a quiet life with just the labours of 36 years of work under my belt.

Hold on. The house sale would be before I moved there anyway.

[gregcrs2 1,777]

17 minutes ago, SCOREAU said:

But if I leave the majority of my savings in uk, how will they know? It's all getting worse by the minute. I don't want to move there and be shafted tax-wise when I could remain here and not be charged on the money gained through a house purchase. I probably see it all too simply, but employing tax professionals and all that isn't my idea of chilling out in the usa and having a quiet life with just the labours of 36 years of work under my belt.

The US requires all foreign accounts with a combined balance of $10,000 or more to be reported.  See link below to get a better understanding.  Not that you will be taxed on it.  

 

https://www.thebalance.com/report-of-foreign-bank-and-financial-accounts-3193148

 

[Lemonslice 4,555]

9 minutes ago, SCOREAU said:

Hold on. The house sale would be before I moved there anyway.

You can live in the UK, and still be considered a US person for tax purposes. Taxation is even more complicated than immigration. Again, no one here can say for sure how your whole situation will affect your taxes.  

 

For example, one of the factors:

https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test

[SCOREAU 36]

37 minutes ago, Lemonslice said:

You can live in the UK, and still be considered a US person for tax purposes. Taxation is even more complicated than immigration. Again, no one here can say for sure how your whole situation will affect your taxes.  

 

For example, one of the factors:

https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test

Thanks. What a palaver it all is - unless you're jumping the border, courtesy of a George Soros handout.

[SCOREAU 36]

1 minute ago, SCOREAU said:

Thanks. What a palaver it all is - unless you're jumping the border, courtesy of a George Soros handout. It's all a big royal pain in the butt, really - and no healthcare, sub-tropical temperatures, a country in political/social turmoil and a border with massive holes in it. Apologies for all my world -  weariness. I appreciate all the great advice nevertheless.

 

[US-UK 32]

1 hour ago, Lemonslice said:

You can live in the UK, and still be considered a US person for tax purposes.

I made an assumption they wouldn’t hit on Substantial Presence, but that would get picked up as soon as they fill in their tax calendars. (These calendars are my nightmare, especially days in multiple countries or US jurisdictions. Don’t be like me and wait until your tax planner deadline to do this piece of the work!)

 

gregcrs2,, I’m glad someone has finally mentioned the FBAR (FinCen 114) and FATCA (IRS 8938) on here, as the finances posts tend to focus on being up to date with taxes and ignore these two additional requirements. This reporting, especially FATCA, may impact a lot of people here who don’t realize it.

Edited June 21, 2019 by US-UK

[Boiler 43,437]

A nightmare and I assume many are not compliant which is fine until it isn't. Basically it seems to be set up so they always can get you