sethb[at]panix.com (Seth) wrote in news:fqc8m1$7c7$1[at]reader2.panix.com:

- quote -

in this case is capital gains (or losses).

--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

In article <Xns9A5457621C55Cikkezelf[at]199.45.49.11> ,
Han <nobody[at]nospam.not> wrote:
- quote -

What's the relevance of your hating to think something to the tax
implications? (Maybe the cash was left in his suitcase for a year
after the trip.)

- quote -

For having the card, I don't know. The fees for using it are part of
the cost basis of the foreign currency.

- quote -

It's not a wash sale.

- quote -

Sometimes I exchange currency with a foreign tourist entering the US.
We both pay the middle rate, no fees.

But the issue is the tax situation when certain events happen, not
whether those transactions are optimal (from whatever viewpoint).

Seth

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

sethb[at]panix.com (Seth) wrote in news:fq9adl$8qd$1[at]reader2.panix.com:

- quote -


While I think that currently the American dollar is badly mismanaged, I'd
hate to think that it is possible that in the course of a "trip" to
England the dollar would devalue by 50%. It really took more than 10
years for the € to go from $0.82 to $1.52. Nevertheless, if I come into
possession of foreign currency when it is worth $0.82, keep it, then sell
it at $1.52, I have $0.70 capital gains, to be reported as such when the
sale is final, and corrected for basis and costs. I just don't know
whether the fees assessed for having an ATM card with the bank holding
the foreign currency would be part of the "basis and costs".


- quote -

I don't know either. Is that barter, or wash sale or what? I can easily
visualize going to France with a bunch of € purchased at 1 rate of
exchange, then going to Denamrk and England, where I would have to
exchange € for local currencies. I would argue that I have not converted
back to $, therfore not realized a gain or loss (latter more likely for
short trips, because of the fees and distorted exchange rates for
tourists).

- quote -

The amounts of foreign currency I usually carry when leaving and
reentering the US are rather trivial. Most transactions are by credit
card or ATM card. But then, I have the philosophy that I don't like
giving banks fees for the privilege of getting currency at a bad exchange
rate. Therefore, I don't get foreign currency in the US prior to a trip
abroad. Now I have to admit that recently credit cards have increased
their fees for exchanging currencies, so ther may be a "better" way than
my way, but I'd hate to leave the US with a lot of currency for fear of
loss or theft.
- quote -

Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

In article <317cb318-a467-4726-bbaf-da0a84ce1ec2[at]u10g2000prn.googlegroups.com> ,
removeps-groups[at]yahoo.com <removeps-groups[at]yahoo.com> wrote:
- quote -

0% on the first $400, no more than 10% on the next $1,000 (as of the
last time I checked, so the limits might have increased). That's for
stuff you carry with out after having been out of the US for over a
day.

- quote -

If they just buy, no taxes. Their basis for the stuff they buy with
euros is the cost of the euros.

- quote -

That's right.

- quote -

I'm sure they have lots of accountants to handle it.

- quote -

No, they have a single gain/loss: the basis includes the currency cost.

- quote -

There is a lot of room to fib.

The administrative burden is already enormous, what's a little more
enormity?

- quote -

Look at the SEC filings, which I believe have a bit more than that. I
don't believe the full tax returns are available, there's confidential
data in them.

Seth

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Feb 29, 8:08 am, se...[at]panix.com (Seth) wrote:

- quote -

Oh, I forgot, there are excise taxes when you bring the goods into the
US. On personal returns, excise taxes are not deductible on Schedule
A. I don't know about business returns. As an example of the size of
excise taxes, what is the approximate excise tax rate for clothing?

- quote -

This is a good point. I believe Berkshire Hathaway converted billions
of dollars to euros many years ago, so if they use that money to buy
US companies, how do they pay taxes? I imagine that if they buy
companies on the US exchanges they would have to convert euros to
dollars and pay taxes on fhe currency gain, but if they buy the US
companies on the European exchange there would be no tax
consequences. But like I mentioned earlier, the tracking of the basis
of each element of currency is too complex; in the case where they buy
a company E on the European exchange, when they sell the company they
have a gain/loss not only on the company E, but also on the currency
that was used to buy E.. Perhaps there is a simpler way to do all
this tracking. I think if the IRS requires you to track things this
way, there's too much room to fib, and the administrative burden is
enormous.

And finally, are business tax returns of public companies a matter of
public record? I only see the balance sheet, income statement, cash
flow, all of which are lacking in meaty details.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

In article <Xns9A5345A8FD7Fikkezelf[at]199.45.49.11> ,
Han <nobody[at]nospam.not> wrote:
- quote -

Sometimes they do.

- quote -

They fit in my suitcase.

- quote -

That's refunded when I export the items from Europe.

- quote -

Matching the sales tax if I bought it locally, so no swing.

- quote -

No, they don't. You don't have any gain, you just bought some stuff
cheaper. Now, if you sell the 16 items in the US for $1600, then you
have a gain.

- quote -

I don't have to prove anything.

Maybe the trip was for some other purpose (and paid for by someone
else), and I just happened to buy some stuff while I was there.

- quote -

What do you want, the serial numbers of the items?

Seth

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

In article <Xns9A52D4A059826ikkezelf[at]199.45.49.11> ,
Han <nobody[at]nospam.not> wrote:
- quote -

He goes to England and buys a bunch of GBP at $1.20. He spends most
of them, has GBP 100 left when he returns home. The dollar crashes,
and his GBP 100 is worth $200. He sells it to a bank for $180.

- quote -

Right (provided you don't spend the money on USD; I don't know what
happens if you spend the money buying some other currency.)

- quote -

Sure, that's one way to handle it. (But if I don't have any personal
expenses on the trip and want to use up my GBP, that doesn't help.)

Seth

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"removeps-groups[at]yahoo.com" <removeps-groups[at]yahoo.com> wrote in
news:411eb552-4772-4e8e-b7e8-b048cd1d8a4c[at]s37g2000prg.googlegroups.com:

- quote -

I don't see that in its generality. Specifics would work better.

- quote -

I think there are different factors here. Changes in exchange rates
don't go quite that fast, generally speaking, and in Europe you would
have to pay for transportation of the item(s) from the US. Plus most
likely the European sales tax (VAT of 20%, roughly). All that would eat
up quite a bit of the currency gain. Then, in many states of the US, you
would have to pay use tax on out of state bought items. I'm not even
mentioning a portion of the costs of the trip.

- quote -

cheaper to make a trip and purchase those items than it would have been
to purchase them straight in the US. Do you have a concrete example?


--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Feb 28, 12:01 pm, se...[at]panix.com (Seth) wrote:

- quote -

The US tax code link I posted said there's no tax if the gain is less
than $200.

- quote -

It seems like a loophole if you can just spend appreciated foreign
currency without worrying about taxes. Say I convert 12k USD to EUR
while EUR/USD is 1.5 (to get me 8k EUR), wait for EUR/USD to fall to
2.0, then use the euros to buy stuff made in the USA and imported to
Europe. Had I kept my 12k in the US, I might have been able to buy
only 12 items, but with my 8k EUR I can buy 16 items (at the time of
sale each item is 1000 USD or 500 EUR). I'm sure the IRS wants a
piece of my gain.

- quote -

The following way makes sense to me: If you convert 12k to EUR for
your business trip, the expense to the company would be 12k. If you
pay your hotel bills with cash, you should save the receipts for
records only, but even if EUR/USD goes to 2.0 during your trip, you
still get to deduct only 12k. Now if you spent 2k EUR on meals and
entertainment, then that is 3k USD even if the rates goes to 2.0
during yout trip, and only 50% or 1.5k USD is deductible on the
business tax return.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

sethb[at]panix.com (Seth) wrote in news:fq73uo$qq5$1[at]reader2.panix.com:

<snip> A foreign traveler who travels for personal reasons (e.g. vacation)
- quote -

Not sure how you would realize a gain, but maybe there is a simple
explanation.

- quote -

Replace relevant nouns with Euro and Holland/France/Belgium. Use my
Dutch account. No gain or loss (I think) when I use the money I
inherited.

- quote -

In the latter instance, I wouldd use my US credit card for larger
payments, my US ATM card for cash. Separate transactions unrelated to my
foreign currency holdings.
Receipts and statements to prove my expenses.

--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

In article <e61b8b25-f8d7-4c2a-b2fc-1e1e27b0bc12[at]s19g2000prg.googlegroups.com> ,
parrisbraeside[at]yahoo.ca <parrisbraeside[at]yahoo.ca> wrote:
- quote -

A foreign traveler who travels for personal reasons (e.g. vacation)
doesn't get to take a capital loss on the currency transactions. If
there's a gain he has to report it.

I choose to just hold the foreign currency. I have around 200 GBP
that's worth about double what I paid. There's no tax, I still have
the bills. When I visit the UK and spend them, there's still no tax.

Interesting question: Suppose my next trip to the UK is business,
hence deductible. If I spend them on my hotel, do I deduct the cost
of the bills, or their current value (when spent) and pay capital
gains on the increase? If I spend them on meals (so only 50%
deductible), what then? Is only half the capital gain reportable?

Seth

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"removeps-groups[at]yahoo.com" <removeps-groups[at]yahoo.com> wrote in
news:1848582f-8004-4352-a3a3-36d905ceef2d[at]71g2000hse.googlegroups.com:

- quote -



--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Feb 25, 7:06*pm, Han <nob...[at]nospam.not> wrote:

- quote -

What are you talking about?

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"removeps-groups[at]yahoo.com" <removeps-groups[at]yahoo.com> wrote in
news:a78a651b-b20f-454f-bd0f-1bf80a533749[at]p25g2000hsf.googlegroups.com:

- quote -

to the IRS, but still follow the law.


--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Feb 24, 4:05 pm, Han <nob...[at]nospam.not> wrote:

- quote -

Are you sure? Here is 988 of the tax code:

http://www.law.cornell.edu/uscode/us...8----000-.html

In there I think they say personal transactions are not taxable, with
exceptions.

In any case, money earned in the account (interest, dividends, capital
gains) would have to be reported on the individual's tax return as
earned. That would mean using a new exchange rate for each item of
interest, dividend, or capital gain/loss received. So when the money
is finally converted to US dollars, there would be different gains on
each part of the money converted. For example, $10,000 might have
been converted at 0.78, so when converted back to USD at a rate of .
92, so the profit is 10000*(.92-.78) or $1400 -- hope I got that
right. But say at some point they received but say AUD 1000 in
interest, and the exchange rate was 0.84, so the amount reported as
interest would be $1190; and when converted to USD at .92, the profit
would be 1190*(.92-.84) = $95. In a typical account with interest,
dividends, capital gains this could get quite cumersome.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Feb 24, 1:23 pm, garagecapital <garagecapi...[at]gmail.com> wrote:
- quote -

The gain on currency exchanges is taxable as a capital gain.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

garagecapital <garagecapital[at]gmail.com> wrote in news:507c3960-a2e0-4274-
88f9-3e3d6b36e724[at]u10g2000prn.googlegroups.com:

- quote -

at a profit, you have a capital gains, if at a loss, a capital loss.

It was annoying to have to translate €9.65 interest received into $13.06,
especially since the bank imposed €15 fees (for the ATM card).
--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

I have an Australian brokerage account. I put US dollars in there a
year ago when the AUD/USD was like 78. Now it is like 92 and I was
going to wire like $30K home to the US. There is a gain here, I
suppose. Is it taxable. And if so, doesn't it mean that every foreign
traveller has to declare a profit or loss on every round-trip foreign
currency transaction. That can't be true, can it?

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >