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Old 04.10.2013, 22:04
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Swiss American couple buying property

I am American and my Mann is Swiss. We are looking to buy a house here in CH but we would only put my husband's name on it as Americans are having so much trouble with the IRS, banks, etc. If my name were on it, I would then be required to report it on my US tax return. Is this a bad idea on my part? Am I being naive? Will I have no right to this house/property if at some point in the future we were to divorce? That is NOT the plan (to divorce) but just wanna cover all my bases...

Thanks for any advice!
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Old 07.10.2013, 10:43
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Re: Swiss American couple buying property

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We are looking to buy a house here in CH but we would only put my husband's name on it as Americans are having so much trouble with the IRS, banks, etc. If my name were on it, I would then be required to report it on my US tax return. Is this a bad idea on my part? !
Putting it or not, if applicable, on a tax return is the least of your problems. Getting a mortgage is the bigger issue I believe, unless you happen to have enough money to buy outright.

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Am I being naive? Will I have no right to this house/property if at some point in the future we were to divorce? That is NOT the plan (to divorce) but just wanna cover all my bases...
Not having your name on the deed means your spose owns the house. Speak to a lawyer regarding future rights and if you are being naive. Are you putting money into the downpayment or outright purchase? If mortgage, do you need two persons (incomes) to qualify. The answers to these will determine if this is possible or not, etc..
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Old 07.10.2013, 10:47
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Re: Swiss American couple buying property

Yes, you can put it only in your husband's name, and yes, you do not both have to get a mortgage, my in-laws' house was done that way.

Tom
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Old 07.10.2013, 15:31
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Re: Swiss American couple buying property

Thank you both for your responses. My husband alone has been approved for a mortgage so now we are actively house hunting. Do you happen to know if there are any places that offer free legal advice about housing? I am a stay at home mom so have no income. I just want to make sure I'm not setting myself up to be screwed if we were to divorce somewhere down the line. I'm not expecting it but just trying to be realistic.
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Old 07.10.2013, 15:45
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Re: Swiss American couple buying property

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Thank you both for your responses. My husband alone has been approved for a mortgage so now we are actively house hunting. Do you happen to know if there are any places that offer free legal advice about housing? I am a stay at home mom so have no income. I just want to make sure I'm not setting myself up to be screwed if we were to divorce somewhere down the line. I'm not expecting it but just trying to be realistic.
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Old 07.10.2013, 15:51
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Re: Swiss American couple buying property

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Yes, you can put it only in your husband's name, and yes, you do not both have to get a mortgage, my in-laws' house was done that way.
But if he has a green card or if they file to the US jointly she will have to declare it since both the US and the Swiss request worldwide asset declarations for tax purposes. It doesn't sound like a primary residence so I'm guessing that a green card and tax filing are part of the equation.

Also, I'd never sink a dime of my own money into a property purchase where my name wasn't on the title. Marriage is nice, but legally binding documentation of property purchases are nicer.
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Old 07.10.2013, 18:07
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Re: Swiss American couple buying property

We put everything in my ex's name for same reason.. Now I live in a small appartment and the ex got it, car and bank in the divorce.
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Old 07.10.2013, 18:24
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Re: Swiss American couple buying property

I believe that you can set up contracts to say that assets are to be shared, even if they are all in one name...
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Old 07.10.2013, 18:39
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Re: Swiss American couple buying property

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I believe that you can set up contracts to say that assets are to be shared, even if they are all in one name...
Nothing to stop the owner issuing a couple of extra mortgages totalling 120% of the value (or more), the asset could turn into a liability.......
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Old 08.10.2013, 10:32
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Re: Swiss American couple buying property

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But if he has a green card or if they file to the US jointly she will have to declare it since both the US and the Swiss request worldwide asset declarations for tax purposes. It doesn't sound like a primary residence so I'm guessing that a green card and tax filing are part of the equation.

Also, I'd never sink a dime of my own money into a property purchase where my name wasn't on the title. Marriage is nice, but legally binding documentation of property purchases are nicer.
Nope, my Swiss husband does NOT have a green card and Switzerland is our primary residence.

Yes, I am not putting any actual money into it per say, but I guess it depends on how you look at it. Some people would say that just b/c I'm a stay at home mom doesn't mean I'm not worth anything. We are saving a lot of money on childcare. If I were working (I'm a teacher with M.Ed so could easily make 80,000 SFr/yr) and we'd be paying maybe 2000 Sfr/ month(?) for full-time child care. What do you think?
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Old 08.10.2013, 11:05
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Re: Swiss American couple buying property

What happens in the event of a divorce depends on where you file for one. If in Switzerland, Swiss laws apply. Unless you have other arrangements in place i.e. a pre-nup, the default setting is this: all assets you acquired during the marriage (no matter whose name is on them) are summed up and the total is split 50/50. In this case it wouldn't matter whose name is on the house. You'd each get back your own contribution to the down payment (assuming it came out of your pre-marital assets) plus half the remaining equity.

HOWEVER, if there is a marriage contract specifying something else, or if one of you files for divorce in a different jurisdiction, all bets are off.

We're in a similar situation to you and after giving it some consideration decided to go ahead with only his name on the house. It's a gamble, but so's getting married in the first place.
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Old 08.10.2013, 11:07
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Re: Swiss American couple buying property

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Will I have no right to this house/property if at some point in the future we were to divorce? That is NOT the plan (to divorce) but just wanna cover all my bases...
well, let's put it that way: if you both own it and you have kids, you'd normally get the house. If the house is in your husband's name and you don't have kids, you normally won't get it but you husband will have to prove that he bought this with money he made before you got married. If he can't, he still gets the house but he'll have to buy you out (which normally results in the house being sold as the money has to come from somewhere).
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Old 10.06.2020, 10:01
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Reviving this because I'd like to see if anything has changed. Also I have a slightly different situation.

In short, I need your help, EF-ers. Our search for a home has suddenly accelerated much faster than we though. We will most likely be signing next week, though confirmation hasn't come through yet that the house is reserved for us (there is another family but our chances are good ...) so things are moving faster than I expected.

Initially when looking at proposals for financing, we were told that my name (I'm American) couldn't/shouldn't be on the mortgage and purchase. My Swiss/South African husband has no ties to the US and when the day comes that I have to file a tax return because I (finally) get employed, I will be filing the US tax return singly.

Now, the bank we most likely will go with says they won't put me on the mortgage. Fine, and we were prepared for this. But now another bank is pushing me to be on the mortgage I understand that there is more protection provided for me if I am an owner of the house, but I am also completely comfortable with my name not being on it. Call me naive, but I do trust my husband completely, and none of my money or my eventual earnings will be going to mortgage payments anyway. He was initially very disturbed at the thought of my name not being on the property, but now what we are worried about is the US tax man, since we know another American-Swiss couple where the Swiss spouse ended up being called upon for taxes (I don't know all the details, but something about one spouse working for the other spouse's company and things got messy from there).

In short, we clearly want to avoid a tax issue, so even assuming one of these banks will/wants to put me on the mortgage, what is the risk for me as an American on my own tax returns, and what would the likelihood be that it would get messy as far as keeping my husband's income/bank account from US tax scrutiny?

Also I can't even begin to communicate the immense stress that this property buying adventure has become! We went from having our offer rejected in a very Swiss (read : very passive-aggressive) way on a beautiful but potentially very expensive house (ultimately needed a lot of renovations, and costly ones at that) to seeing another house that very week that we though wasn't going to be good at all based on the photos. Instead, we were met with a very outdated but full of potential property right in our budget, with mainly renovations that we could do ourselves over the course of time. Now it's a mad dash as it's a divorce case, the owner wants out ASAP and he's stated that the first of us two families to come with a written agreement from the bank gets the house, and can we sign next week please. Cue lots of running around ... we're fortunate to already have one agreement, we're just hoping for a better one this morning but won't push it longer than that.

Last edited by roegner; 10.06.2020 at 10:26. Reason: Merging consecutive posts
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Old 10.06.2020, 20:13
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Re: Swiss American couple buying property

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...when the day comes that I have to file a tax return because I (finally) get employed, I will be filing the US tax return singly...
I can't answer your question about property, but this bit caught my eye. If you have more than 10 USD in income during the year, such as interest on your bank accounts, you need to be filing taxes because you'd fall under "Married-Filing Separately". Don't ask me why the limit is so absurdly low, but that's what the 1040 says.

If you have the equivalent of 10K USD or more in any bank account where you have signature rights, you need to be filing FBAR.
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Old 10.06.2020, 20:16
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Re: Swiss American couple buying property

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I can't answer your question about property, but this bit caught my eye. If you have more than 10 USD in income during the year, such as interest on your bank accounts, you need to be filing taxes because you'd fall under "Married-Filing Separately". Don't ask me why the limit is so absurdly low, but that's what the 1040 says.

If you have the equivalent of 10K USD or more in any bank account where you have signature rights, you need to be filing FBAR.
And that's an aggregate figure btw for the foreign, i.e. outside of US, bank accounts.
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Old 10.06.2020, 20:55
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Re: Swiss American couple buying property

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I can't answer your question about property, but this bit caught my eye. If you have more than 10 USD in income during the year, such as interest on your bank accounts, you need to be filing taxes because you'd fall under "Married-Filing Separately". Don't ask me why the limit is so absurdly low, but that's what the 1040 says.

If you have the equivalent of 10K USD or more in any bank account where you have signature rights, you need to be filing FBAR.
I have 0 income and 0 in swiss bank accounts, nor do I have signature rights to my husband’s account. In the US I have a very small (under $20) amount left in an old bank account I don’t want to close just yet that received no interest. Thanks for the information though. I will definitely need to be filing an FBAR for next year if I get this upcoming job opportunity ...

Edited to add: in the end, we went with keeping my name off the house purchase. Too complicated and too risky, this was after speaking with several other American-swiss couples we know.

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Old 11.06.2020, 00:38
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Re: Swiss American couple buying property

Similar situation here but... just curious about using 3. Pillar money as capital. We would like to use my 3. Pillar as part of the capital but would also like to keep my name off the mortgage. I am assuming this won't work but... can someone confirm? Thanks
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Old 11.06.2020, 11:00
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Re: Swiss American couple buying property

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Similar situation here but... just curious about using 3. Pillar money as capital. We would like to use my 3. Pillar as part of the capital but would also like to keep my name off the mortgage. I am assuming this won't work but... can someone confirm? Thanks
Im not sure how that would work. A friend of mine (American) transferred her inheritance to her husband (Swiss) with a signed letter saying she was in agreement that he use the money toward a house. But Id think 3pillar wouldnt be so simple to transfer.
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Old 11.06.2020, 18:59
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Re: Swiss American couple buying property

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Thank you both for your responses. My husband alone has been approved for a mortgage so now we are actively house hunting. Do you happen to know if there are any places that offer free legal advice about housing? I am a stay at home mom so have no income. I just want to make sure I'm not setting myself up to be screwed if we were to divorce somewhere down the line. I'm not expecting it but just trying to be realistic.
I think you should voice your concern to your husband and ask him to consult a lawyer to tell you the laws pertaining to divorce.

I have found the folks on this forum to be knowledgeable and generous with their time, but they are not lawyers.

For most people, their home is one of the major components of their wealth. It is completely reasonable for you to check this.

That being said, if you are a house wife and have no income, I assume you are not helping with the down payment or the mortgage, so it it also not clear to me why should you be entitled to half of the home. But my or anyone else's philosophical viewpoint on whats fair or not is irrelevant. The laws of the land are the only truly relevant features. So again, talk to a lawyer.
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Old 11.06.2020, 19:32
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Re: Swiss American couple buying property

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if you are a house wife and have no income, I assume you are not helping with the down payment or the mortgage, so it it also not clear to me why should you be entitled to half of the home.
Same reason that she's entitled to half of any other assets acquired during the marriage.

Tom
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