A multi currency portfolio course subscriber just asked about this when he sent this question:
Hi Gary, With the depressing and seemingly endless deterioration of the U.S. financial condition, my interest in offshore investing is growing rapidly. Given your many positive references to Jyske Bank, I finally decided to contact Thomas Fischer to begin the process of evaluating specific multi-currency investments. Apparently, Thomas was on a business trip, but Peter Vestbirk Laub was kind enough to respond to my email.
I had a question about the U.S. tax impact of a typical multi-currency investment with Jyske. However, Peter recommended that I consult with a local tax expert. Unfortunately, I have not yet located a tax person with expertise in this area.
Gary, you answered part of my question in your “Multi Currency Tax” article which said “stocks and bonds purchased abroad are treated under US tax law in the same way as stocks and bonds in the US for tax purposes.”
However, I was under the impression that foreign investments are burdened with additional U.S. tax filing requirements. I’m trying to determine the scope of this extra overhead. I also want to know if there are annual U.S. taxes that need to be paid on a multi-currency investment or do you pay your taxes when the investment is sold or closed out. If you’re willing to share your personal experience on this matter, that would be great. Otherwise, can you point me to other resources that might be of help? Regards,
This is a good question.
First I want to mentioned that Thomas Fischer is speaking at our upcoming International Investing and Business Course.
To help our Multi Currency subscribers meet him and learn direct how Jyske can help, we are are dropping the price of your subscription, $249, from the course fee. The normal course fee is $749 for one or $999 for two. The fee for all Multi Currency Portfolio Course subscriber is reduced to $500 for one or $750 for two. Send me an email at email@example.com to set up the discount.
Now back to tax. Essentially investments held abroad are tax neutral, other than mutual funds. Non US mutual funds have the potential of being considered PFICs. You can read more about PFICS at PFIC Mutual Fund Regulations.
This article also have the email address of a good attorney who specializes in overseas structures, Leslie Share. His email address is firstname.lastname@example.org
The tax attorney I use (and have for decades) is Joe Cox at email@example.com
Other than this, normally investing abroad is tax neutral.
There is one reporting requirement on overseas investments that has nothing to do with tax. If the total of your bank accounts and investments held abroad are $10,000 or more (total amount of all account), US citizens and residents tax payers are required to submit a form TDF 90-22.1 to the Treasury department. This is not a tax or IRS form and you should not send it to the IRS. This is a Treasury department form.
However you can read about the TDF 90-22.1 at the IRS’s website.
Please send me any other questions. I’ll give the questions priority if you add BL in the subject line. I cannot give you direct investment advice individually but can answer questions (without disclosing your identity) in these lessons.
Better still ask you questions in person! Join me with Thomas Fischer of Jyske Bank, Merri and me Friday to Sunday, October 3-5 to learn more about International investing and business. We selected this weekend as the most likely to be beautiful with the autumnal leaf change. The colors are glorious.
Here delegates at a previous course chat during a coffee break.
The October course is traditionally our smallest so we time to take questions from everyone. Save $249 (the fee you paid for this online course) off the normal enrollment.
Enroll for one…only $500. Join us. Save $249 for one here
Enroll for two…only $750. Enjoy a couples discount. Save $749 for two here