Hi Team,
I am working in US for many years and currently located in California. I am retiring and moving away from US to South America this year. I will maintain a physical address in Florida to get all my mails etc. however will be living outside US throughout the year from now onwards. I will be receiving dividends etc. on my investments in US. My question is - do I need to pay federal and state taxes while I am not staying in the country? I am not a US citizen.
Thanks,
Yes, you will probably need to continue to file a Nonresident Return unless you choose to have the tax liability satisfied by the withholding of tax at the source. It is best to file the return because the withholding may or may not be enough to cover the tax liability so you want to file to be sure you not owe and/or get a refund if overpaid.
Very complicated. See 26 U.S. Code § 7701 - Definitions | U.S. Code | US Law | LII / Legal Information Institute (cornell.edu) Section 7701(d)(1)(A)(i) and others.
The way I read it is if you keep your "green card" you are a US tax payer. If you have physical investment income (eg. rental properties), you are a US tax payer. But if you have neither and simply invest the monetary instruments in the US (eg. stocks) you may not be a US tax payer.
Your tax situation in you home country will also influence the results as foreign taxes are often part of the calculation.
Bottom-line is it's going to cost you fees from a qualified Tax Attorney to get the correct answer.
You do need to pay federal taxes on income earned in the United States. You will need to file a federal tax return unless you have sufficient taxes withheld at the source.
You do not need to file a Florida state tax return since Florida does not tax personal income.
You would have to check the filing requirements in each state from which you receive income to see what their filing requirements are.
This article from the IRS may be helpful:
https://www.irs.gov/individuals/international-taxpayers/taxation-of-nonresident-aliens