Dear Community,
I am a French citizen living in the U.S. and I own a French investment product called an "assurance vie." This is a specific type of account in France, and I’m not sure how it should be classified under U.S. tax regulations.
In this account, I hold funds in euros that generate interest. These interests are credited both monthly and at the end of the year.
In France, the gains would be taxed in two stages:
- Social taxes (17.2%) are applied when the gains accrue. This does not apply as I do not live in France anymore.
- Income taxes (12%) are applied when the money is withdrawn. This would apply.
My question is: how should I report these gains in the U.S.? Should they be declared as income when they accrue? If so, does this mean that I’ll be taxed in the U.S. when the gains accrue and then again in France when they’re withdrawn, leading to a combined tax rate (12 % income taxes from France + income taxes in US on the gain) ?
I would greatly appreciate your guidance on how to handle this situation properly.
Thank you for your help!
Best regards,
Thomas
