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Old 31.10.2010, 02:18
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Us tax - swiss tax - interest income vs. Loss on stocks

If you have a large loss from stocks you don't pay income tax on interest earned on bank accounts in the US.

it doesn't seem fair that that bank account has to be declared in CH and to pay tax on its interest.

Any way to avoid it?

Thanks.
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Old 31.10.2010, 02:15
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Re: Us tax - swiss tax - interest income vs. Loss on stocks

Huh?

Where is it legislated that interest income is not taxable if and only if you've lost your shirt on the stock market?
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Old 31.10.2010, 10:39
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Re: Us tax - swiss tax - interest income vs. Loss on stocks

I did not say that.

If you have a capital loss carry over you pay less on interest income than if you don't. So capital loss offsets interest income in the US. But in Switzerland you have to declare that income and pay tax on it. Is there a way around that? If US doesn't hold you liable to full tax on that why should you pay in CH? Is there a legal way out of that in CH?
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Old 31.10.2010, 11:08
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Re: Us tax - swiss tax - interest income vs. Loss on stocks

Javap, welcome to the wonderful world of conflicting tax regimes. The goal and even taxing philosophy of each country is different.

You really need an advisor who is conversant in both US and Swiss tax - how you proceed really depends on your individual situation.

As our US taxes are quite a bit higher than our Swiss taxes, we have found it beneficial to focus our financial planning with US tax rules first in mind, as reducing one's Swiss liability beyond a certain point only results in more US tax owed.

But that is our situation - your mileage may well vary.

As an American, you are going to end up paying roughly (very roughly) the amount of your US liability in total, split between the US and Switzerland. The question is, to which country would you rather pay the lions share?

Seriously, a good US-CH tax advisor is money well spent.
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Old 31.10.2010, 11:16
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Re: Us tax - swiss tax - interest income vs. Loss on stocks

Thanks a lot. That was going to be my next question anyway: do you recommend anybody good who doesn't charge and arm and a leg for giving some advice.
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