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matts19
New Member

Will I be taxed when I retire and move ALL of my money overseas ?

Say, for simplicity, I have $2 million dollars upon retirement, all in cash.

And I want to move all of that money overseas (in one lump sum) and retire there.

Will there be any roadblocks to doing that from U.S. side ? Thanks.

2 Replies
Opus 17
Level 15

Will I be taxed when I retire and move ALL of my money overseas ?

If you have cash, there are no taxes involved in the act of transferring it from a US bank to an overseas bank.  

 

If you retain your US citizenship, you are required to report and pay US income tax on all your world-wide income, no matter where you live. This means that any investments you make with the money overseas, or any interest paid to you by banks, must be reported on a US tax return. Even though overseas banks and investment firms might not issue 1099-INT or 1099-B statements, you still are supposed to report the income and pay the tax.  If you are also taxed on the same credit in a foreign country, the US will give you a credit or deduction against that tax, but you still have to file.

 

Just the act of transferring your own money from one place to another is not taxable. 

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
rjs
Level 15
Level 15

Will I be taxed when I retire and move ALL of my money overseas ?

The transfer of the money overseas is not taxed. However, once the money is in a foreign account you are required to file certain reports every year. If your foreign accounts have a total value of more than $10,000 you must file an FBAR. If your foreign accounts have a total value of more than $50,000 you must file a FATCA report. The penalties for not filing the required reports are severe. See the following pages on the IRS web site for some basic information to start familiarizing yourself with the reporting rules.


Report of Foreign Bank and Financial Accounts (FBAR)


FATCA Information for Individuals


Summary of FATCA Reporting for U.S. Taxpayers

 

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