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Old 30.03.2011, 12:02
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Not sure what you are bringing to this thread. If a US citizen, you are subject to US tax irrespective of your residence.

When filing, etc. the tax code and sometimes bilatalteral tax agreements give certain advantages or lessen the tax burden depending on the circumstances. Indeed there is the foreign earned income exclusion, but you would need to qualify in the first place and earn less than the cap. In a lot of instances, just because of falling through the cracks, US citizens living abroad often do owe a signifiant sum to the IRS.
If you are going to inform him, then you need to tell him all the relevant facts. Have you mentioned that there is a possibility that he may not need to give up his citizenship OR pay taxes? All he needs to do is "qualify." And its obvious as he does, since he said he has never lived there. So he meets the first part. Now he needs to meet the income exclusion.

So thats what I'm bringing. A different option.
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  #22  
Old 30.03.2011, 12:09
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

As from other threads, it is clear that no one on the EF earns less than 120,000 chf per year, thus clearly over the earned income exclusion limit. It is not just the cost of potential tax either, it is the cost and time, and perhaps hiring professional advice, for the "filing" itself. And this is just for the tax filing. Not to mention the FBAR filing/penalities, and the future FATCA filing.
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  #23  
Old 30.03.2011, 12:12
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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As from other threads, it is clear that no one on the EF earns less than 120,000 chf per year, thus clearly over the earned income exclusion limit. It is not just the cost of potential tax either, it is the cost and time, and perhaps hiring professional advice, for the "filing" itself. And this is just for the tax filing. Not to mention the FBAR filing/penalities, and the future FATCA filing.
Your sarcasm is noted. I didn't realize I should assume that everyone on here makes above 120,000. And the forms can be filed on your own (IE - free) via the internet as well. Now as for penalties and the like. Fine. Surely its an unfortunate circumstance. Please, next time someone that is fairly new tries to join in, refrain from trying to belittle them.
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Old 30.03.2011, 12:36
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Even worse, google the penalities for not filing the FBAR. If you are lucky there will be another amnesty for the FBAR, if not, I'd be a bit worried.
You're probably already aware of this, but just in case, there is a new amnesty programme.

http://blogs.forbes.com/irswatch/201...re-initiative/

There's a 'special offer' for the 'Accidental American'.
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Old 30.03.2011, 12:37
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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You're probably already aware of this, but just in case, there is a new amnesty programme.

http://blogs.forbes.com/irswatch/201...re-initiative/

There's a 'special offer' for the 'Accidental American'.
Helpful. Thank you. Always good to be aware.
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  #26  
Old 30.03.2011, 12:43
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

Both in Germany (Deutsche Bank) and here in Switzerland (Postfinance) I (as a US citizen) have had to sign a recognition that the bank will provide information to the IRS. I haven't had any other problems, situations or paperwork from banks, though I have always been a legal resident and had a proper visa.

A bank MUST not take your business, right? So does the adage "speak with your wallet" apply, and you should go somewhere else, where you might be more appreciated?
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  #27  
Old 30.03.2011, 12:52
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Personal question if you don't mind. Your children, at 18 years old, certainly wouldn't have any tax liability. Why would you suggest they renounce their citizenship? Is it based on principle? (which I can appreciate). Just curious.
No principle involved. Just...

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...should it turn out they will probably never live there. It will be a lifelong drag for them, and any future spouses, should they keep it and never actually live or work there.
Who wants to spend the rest of their working life filing a tax return in a country where they have never, and possibly will never, live or work?
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  #28  
Old 30.03.2011, 12:54
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Under the Bank Secrecy Act, U.S. residents or a person in and doing business in the United States must file a report with the government if they have a financial account in a foreign country with a value exceeding $10,000 at any time during the calendar year.
I found that on the Tax amnesty website that was mentioned above...

Does that mean if we don't ever have over 10,000USD in any account at any one time that we don't have to file US taxes? Cause if that is the case then we definately don't have to pay taxes!!..we are always wayy under (before and after salary payments expenses etc...!) and the only reason we have to open an account with UBS is for our mortgage account which technically means we owe the bank a ton of money, rather than having any asset with the bank right?

Ie. the mortgage account would be us paying in our mortgage each month, but to the bank to repay the debt, so its not our money once it goes to the bank, hence, not our asset, but our liability...am I correct?
In which case if we have a mortgage account of a million francs or so, that means we are in debt of a million francs, not in credit, so we don't need to file or??? Am i understanding correctly??
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  #29  
Old 30.03.2011, 12:55
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

I have a friend that is in this same situation. He is Swiss/American, and he has never filed a tax return.

As soon as he files a tax return, he will be in the tax system. He
has decided not to ever file a tax return and take the risk.

Good luck!


There are several threads on taxes that might be helpful.
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  #30  
Old 30.03.2011, 12:56
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Your sarcasm is noted. I didn't realize I should assume that everyone on here makes above 120,000. And the forms can be filed on your own (IE - free) via the internet as well. Now as for penalties and the like. Fine. Surely its an unfortunate circumstance. Please, next time someone that is fairly new tries to join in, refrain from trying to belittle them.
Runningdeer meant no offence (in my opinion). It's just that there is a running joke on the forum that people worry that 120k won't be enough to live on here en Suisse. And 120k is over the IRS threshhold for tax-free foreign earned income, which from memory is somewhere around $80,000.

Just a little in-joke. Stick around a while and you'll be cracking them too.
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Old 30.03.2011, 12:59
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

In reply to Rachvdg,

It seems you are confusing the two topics--a. taxes/IRS and b. FBAR/Treasury.

The info you quote is for FBAR filing, but be aware it includes all types of accounts, and it is the aggregate of all accounts. It is very easy to get to 10,000 USD. The second issue is the filing of taxes, where indeed if you have very low income you would not likely have to file, but most salaries in CH are very much above the level needed for filing.
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  #32  
Old 30.03.2011, 13:06
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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In reply to Rachvdg,

It seems you are confusing the two topics--a. taxes/IRS and b. FBAR/Treasury.

The info you quote is for FBAR filing, but be aware it includes all types of accounts. It is very easy to get to 10,000 USD. The second issue is the filing of taxes, where indeed if you have very low income you would not likely have to file, but most salaries in CH are very much above the level needed for filing.
Minor addition: the accounts include pillar 3 accounts.

Minor correction: you're obligated to file regardless of your salary if you're living abroad. Whether you pay is determined by your salary.
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  #33  
Old 30.03.2011, 13:08
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

As has been mentioned before, the real crunch is FATCA. This may change the circumstances of USC's abroad (the ability to go under the radar). If non-US financial institutions want to do business in, or with, US financial institutions, there are penalties for noncompliance with FATCA rules. The non-US banks are opposing the account balance reporting (costly), but they seem to be agreeing to the reporting of US Citizen clients. I would guess it's to do with staying on the good side of the IRS.
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Old 30.03.2011, 13:12
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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No principle involved. Just...



Who wants to spend the rest of their working life filing a tax return in a country where they have never, and possibly will never, live or work?
Fair enough. Thanks for the reply. Both of them.
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Old 30.03.2011, 13:15
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Runningdeer meant no offence (in my opinion). It's just that there is a running joke on the forum that people worry that 120k won't be enough to live on here en Suisse. And 120k is over the IRS threshhold for tax-free foreign earned income, which from memory is somewhere around $80,000.

Just a little in-joke. Stick around a while and you'll be cracking them too.
The current tax-free foreign income threshhold for 2011 is $92,900.
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Old 30.03.2011, 13:17
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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And 120k is over the IRS threshhold for tax-free foreign earned income, which from memory is somewhere around $80,000.
Yes, it certainly is. But if I'm not mistaken, you would only pay on the amount above the threshold, which at this point I believe is $90,000+. I could be wrong.

http://www.irs.gov/newsroom/article/...108276,00.html

Edit: Looks like HollidayG beat me to it! Thanks.
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Old 30.03.2011, 13:22
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Yes, it certainly is. But if I'm not mistaken, you would only pay on the amount above the threshold, which at this point I believe is $90,000+. I could be wrong.

http://www.irs.gov/newsroom/article/...108276,00.html

Edit: Looks like HollidayG beat me to it! Thanks.
Yes, that's true. And for most of us, this means very little, if any tax to be paid to the IRS each year. The catch comes if you have a windfall payment (like the inheritance issue I mentioned earlier, or you sell some property and make a profit etc) and the boring, annual task of simply having to file the return in the US.

(I file in three countries every year, for various reasons, and of course, none of them have the same "tax year". I feel like I am continually filling in tax forms.)
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Old 30.03.2011, 13:24
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Yes, that's true. And for most of us, this means very little, if any tax to be paid to the IRS each year. The catch comes if you have a windfall payment (like the inheritance issue I mentioned earlier, or you sell some property and make a profit etc) and the boring, annual task of simply having to file the return in the US.

(I file in three countries every year, for various reasons, and of course, none of them have the same "tax year". I feel like I am continually filling in tax forms.)
Yes, I see your point. Three!?!? Now I can see why you might convince your children otherwise.
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Old 30.03.2011, 13:25
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

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Minor correction: you're obligated to file regardless of your salary if you're living abroad. Whether you pay is determined by your salary.
Minor clarification--the gross income filing limits would still apply to persons living abroad in my experience, thus if single and earning less than 9,350 USD, there would be no reqirement to file.
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Old 30.03.2011, 13:55
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Re: Opening a Mortgage account with UBS - US Citizen disclosure papers?

I just heard back from our banker - he said it's no problem at all. It doesn't mean that they give any information to the IRS and I am still protected by the banking secret. It just means they can't open a funds account in my name. I'd have to do that in the name of my wife. But as this is a debt account it most likely will never be looked at. The data of customers which was given to the IRS by the UBS was for customers who generally have millions in their accounts.

Someone mentioned PostFinance does the same.
I've opened my PostFinance account a long time ago. They don't know I am American - because they never asked.
I also already had a UBS account in the past but closed it. If I hadn't done that I wouldn't have that problem because I am sure the UBS doesn't send this form to all their existing clients just in case one of them in a US citizen.

Thanks for all the links - I'll read through them when I have a bit more time.
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