"U T" <uht[at]yahoo.com> wrote:

- quote -

As a US citizen, you will always be taxed (or need to
report) on all of your worldwide income. You will continue
to file the same 1040 tax return no matter where you live.

That being said, there exists an exemption that, if you
qualify, will allow you to exclude up to $80,000 in *earned*
income from taxation. The key here is earned income,
meaning income from performing work. There would be no
additional exclusion available for retirement income.

- quote -

No difference. You will be taxed on the distribution under
the same rules no matter where you live.

- quote -

It couldn't hurt to let the bank know of your arrangement.
It is probably a good idea to let a trusted person in the US
get your mail, it might help expedite things if there is a
problem.

One issue you might want to check out: In some states, if
you move out of state to a foreign country (as opposed to
another state) they may decide that you have not changed
your domicile and may want to continue to consider you a
resident and continue to tax you. You might want to verify
that, and take any steps to move your domicile out of that
state before you leave.

Bryan

------------------------ Bryan Kellar, EA
Oregon Tax Help, Inc. -- Portland, Oregon
www.oregontaxhelp.com
www.canadatax.org

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U T wrote:

- quote -

The filing requirement in 2005 for a couple filing a joint
return is gross income of $16,400. You may add $1000 to that
amount for each person who has attained age 65. It doesn't
matter where you reside on the planet. The filing
requirement, exemptions, standard deduction, tax rates, etc.
are the same. If your taxable gross income from all sources
exceeds the filing requirement, you must file an annual tax
return. You may itemize your deductions or take the
standard deduction.

If you are domiciled in Argentina, you should use your
Argentina address. As long as the financial institutions
have the correct taxpayer ID on your accounts, you would not
be subject to any tax withholding on interest, dividends or
capital gains.

Credit card accounts can be a little tricky as some issuers
of credit cards do not allow a foreign residence. You would
need to check with the issuer of the card.

--
Alan
http://taxtopics.net

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"U T" <uht[at]yahoo.com> wrote:

- quote -

The income threshold for filing is the same irrespective of
where you live.

Your federal filing requirement is the sum of the following:

2 personal exemptions
Married filing joint (MFJ) standard deduction
Additional standard deduction for age and / or blindness, if
applicable

For 2005, these amounts are:

$ 6,400.00 2 personal exemptions [at] $3,200 each
10,000.00 MFJ standard deduction
1,000.00 Additional standard deduction if at least
age 65 and / or blind

Assuming both spouses are under age 65 and neither is blind,
your filing requirement for 2005 is $16,400.00 ($6,400 +
$10,000). If either or both spouses are at least age 65,
add $1,000 or $2,000 as applicable.

You can find these amounts listed in the Fairmark reference room.

http://www.fairmark.com/refrence/index.htm

- quote -

You will be taxed the same whether you reside in the USA or
Argentina.

- quote -

You should consult a local tax advisor but I think you would
be better off using your address in Argentina. The reason I
say this is that if you continue to use a New Jersey
address, the state will expect you to file and pay state
income tax.

I have a couple of other suggestions also. Once you are in
place in Argentina, complete IRS Form 8822 and fax it to the
Philadelphia Service Center (PSC) to notify IRS of your new
address. The fax number for PSC is (215) 516-2555.

Form 8822
http://www.irs.gov/pub/irs-pdf/f8822.pdf

Another recommendation I have is that you give someone you
trust, such as your child, an IRS power of attorney (POA) so
that the IRS can discuss your account with them should a
problem or issue arise. IRS powers of attorney are year
specific, meaning that the POA must list each specific year
that the IRS is authorized to discuss with the POA. You can
include up to three future years. If your POA is a not a
tax professional, the appropriate form to use is IRS Form
8821.

Form 8821
http://www.irs.gov/pub/irs-pdf/f8821.pdf

Form 8821 can be faxed to the same PSC fax number that I
listed above.

I don't know if Argentina has a personal income tax or not.
If you are liable for Argentinian income tax, you will be
eligible to claim a foreign tax credit (FTC) on your U.S.
return for the income tax paid to Argentina. Foreign tax
credit is claimed on Form 1116. IRS Publication 514 has
more information on the FTC.

Lastly, you may find IRS Publication 593, Tax Highlights for
U.S. Citizens and Residents Going Abroad, helpful.

Publication 593
http://www.irs.gov/pub/irs-pdf/p593.pdf

Good luck to you.

Frederick Lorca

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Hello All!

I am just about to retire and plan to move to Argentina.
I am a US citizen and my wife is Argentinean. We own a
house down there and with my pension we'll have enough
to live comfortably. My pension will amount approximately
US$ 16,000 per year. We always file our taxes together and
she has no source of income.

Although I believe a total yearly earning of US$ 16,000,
for a couple, does not need to be reported if you live
in the USA, I would like to ask a few questions to this
panel.

1) If we change our residence to a foreign country
(Argentina,) does our year tax exemption increase?
If so, does it apply to all of our earnings?

For example, if we take money out from an IRA while
we live abroad, (supposing that the exemption abroad
is higher than in USA,) would we be taxed differently
for it; or would it added to our total yearly earnings
and taxed considering that we live out of USA?

2) We are planning to keep USA bank and credit card
accounts active while we live in Argentina. The
Internet is nowadays perfect to manage all these
accounts. However, if we change our address to
Argentina (and thus our country of residence,)
do you suggest alerting our bank about it, or
shall we use our child's address in New Jersey
for those accounts?

I really appreciate your help and input on this matter.

Thanks a lot guys.

Mark

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