Capital Gains after moving overseas

[remsta]

Hi all,

I know this is not official advice but I am hoping someone can point me in the right direction. I made a Capital Gain on stocks I bought in 2020 and then sold in March 2022. I then panicked and re-bought a few days later since the shares were still going up and the predictions were positive. A few days later everything started crashing, instead of selling I held. I have now made a significant capital loss. 

So my situation is complex: I was in the US working under a visa until 01.31.22 - I got 1 month salary in 2022, I am not a Citizen, nor a GC holder so I am no longer associated with the US. I am now working overseas as of Feb 22, I sold the shares in March after leaving the US.

From my understanding because of this situation I do not have to pay tax on the Capital Gains. Knowing that I will get a 1099, will Turbo Tax be able to handle this situation and remove the taxes owed?

Thank you

[Anonymous_]

@pk 

[pk]

@remasta, what country are you from ? Which country are you working in now? How long were you here in the USA with work visa and was this your total stay in the USA? While I await your answers, in general, passive income by a Non-Resident Alien is taxed at a fixed 30% ( unless impacted by tax treaty conditions). Generally , if you sell capital assets and buy back within 30 days , then this may come under wash sale rules --- no losses are recognized but gains may be. Your holding on to losing stocks ( i.e. sell, buy back and hold) is only paper loss i.e. un-realized loss . No actual loss occurs / recognized till effected i.e. transferred/ sold. I will circle back after you answer

[remsta]

Hi @pk,

Thank you - now working in Switzerland - I thought that it falls under these rules here, is that not correct? I am no longer associated with the US in any way, i.e. Visa was canceled and not been a resident since January 31. 

https://www.investopedia.com/ask/answers/06/nonusresidenttax.asp

[pk]

@ remsta, while the article quoted is correct but the situation is different --- the general case is a Non-Resident Alien investing is stocks/bonds/capital asset while being a Non-resident ( and generally implying the source of the investment is foreign and therefore the person's US connection is tenuous. In such cases mostly the country of citizenship is going tax the gain under its laws. In your case you invested while a US resident and therefore there is closer connection. One can assert treaty benefits ( I need the country of citizenship ) if and only if one can show "closer connection " to another country or home country. Also note that , even if you submitted the final paperwork , leaving the USA, the date when this is recognized may be much later than the actual submission date. So could you please provide your exact dates and situation when exiting this country -- i.e. what forms were filed when -- please pk