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Old 11.07.2016, 23:40
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18 month Secondment from Switzerland to USA

Evening,

I'm leaving Switzerland and moving to the USA for an 18 month secondment. I am about to apply for visas with my employer and negotiate a contract whilst out there. Whilst this is an exciting opportunity, I'm uncertain about any elements that I should look out for. I'd be grateful for any advice that you may have to offer

Open questions that I haven't yet worked out are
- residency and tax situation
- pension plan
- health insurance (other necessary insurances)


Thanks in advance!
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Old 12.07.2016, 10:17
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Re: 18 month Secondment from Switzerland to USA

1 - You'll be a resident of the state you move to, and have the privilege of paying taxes to that state and the U.S. federal government. You'll file returns for both. Employers in the U.S. deduct taxes from your paycheck before you get it. You might also still be a Swiss resident for the year, so don't forget your tax obligations this side. As you'll be a U.S. person for tax purposes, you may also need to declare any bank accounts elsewhere in the world with a balance of more than 10,000 USD. Google FATCA and happy reading.

2 - Social Security and FICA are also deducted from your wages, and you can't take it with you when you leave. Your employer may have a pension plan, ask them how it works. A lot of U.S. pension plans are called 401Ks, which are similar to 3rd pillar here, I think. You invest your pretax money to lower your overall tax obligation. Sometimes the employer matches, sometimes they don't.

3 - Health insurance is required by law. You'll apply on your own for the coverage you need and the price you're willing to pay. Other insurances you'll likely want would be for car, home, and personal liability. If you live in a flood zone, be sure to purchase flood insurance, which is separate from regular home/renter's insurance.

Good luck!
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Old 21.07.2016, 14:35
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Re: 18 month Secondment from Switzerland to USA

Hi 3 Wishes,

Thanks very much for your message and sorry for my late reply!
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Old 21.07.2016, 15:16
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Re: 18 month Secondment from Switzerland to USA

Health insurance can also be provided via the employer under a group plan. If you elect to take coverage under the employer, the employer will provide FORM 1095-C which provides proof of coverage when filing taxes.
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Old 21.07.2016, 16:02
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Re: 18 month Secondment from Switzerland to USA

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Health insurance can also be provided via the employer under a group plan. If you elect to take coverage under the employer, the employer will provide FORM 1095-C which provides proof of coverage when filing taxes.
Oh duh! I totally forgot that bit, and it's a large part of insurance in the U.S.!

In fact it's quite common for the employer to provide health insurance, due to federal law requiring employers with more than 50 full-time-equivalent employees to offer an insurance plan or face a tax penalty.

Usually the employee and employer each pay a portion of the premium cost. The employee's portion is often deducted with the bi-weekly or monthly payroll, pre-tax. This lowers the employee's taxable income a little bit.

The employee may have an annual deductible (similar to the franchise in Switzerland) and/or copays for each doctor visit or procedure.

Some employers also offer health savings accounts, or HSAs. These allow employees to set aside money pre-tax to put toward medical expenses. The upside is that if used properly they reduce taxable income and provide a cushion to cover expenses as they arise. Some even will reimburse over-the-counter medicines like ibuprofen, and some allow you to use the funds to offset gym membership costs. My friends have used HSAs as a way to save and pay for big expenses such as braces for the children.

The downside is that most HSAs are "use it or lose it" - if the actual medical expenses are less than the amount that has been withheld in anticipation, the money is not returned to the employee. Calculate carefully!

Thanks VFR for jogging my memory!
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