web analytics
August 4, 2015 / 19 Av, 5775
At a Glance
Blogs
Sponsored Post


Three Mistakes that Can Get You in Big Trouble

When it comes to the IRS, out of sight is not out of mind.
Goldstein 485x300

Filing taxes is complicated. The forms aren’t particularly user friendly, and if you’re not quite sure what you’re doing you can end up making quite a few errors. The problem with errors on tax forms is that they can be very costly. For people who have multiple citizenships and residences (think olim or folks who spend a portion of the year living in Israel), the challenges of tax reporting are even more complicated.

I spoke with international tax lawyer Dave Wolf (and fellow contributor to a book on tax guidelines for American expatriates) and asked him, “What’s the worst mistake you’ve seen an expat make?”

He said: “The biggest mistake that I’ve seen expats make is believing that once they move out of America, they no longer have to report their worldwide income or report the existence of foreign bank accounts or companies.” Indeed, when it comes to the IRS, out of sight is not out of mind. It’s also important to note that if you have American citizenship through a parent or grandparent, even if you’ve never lived in America and English isn’t your mother tongue, you’re still obliged to report to the American tax authorities.

Mistake #2

Another common blunder that Dave mentioned was that people look for investment opportunities without taking into consideration the U.S. tax code. Specifically, complicated U.S. tax laws basically prevent American taxpayers from investing in overseas mutual funds. The IRS considers those investments “PFICs,” (passive foreign investment companies), and most Americans who understand how they work would not want to get involved with them or offshore mutual funds. When trying to invest smartly, lack of knowledge of international tax consequences can cost you a lot of money.

Final Mistake

The third blunder people make, Dave said, is “They either go to the wrong adviser, one who has no overseas experience, or they just don’t get any professional help at all.” I asked how you can avoid these mistakes. He said, “Make sure to consult with your tax lawyer, accountant, and/or investment manager before you leave the States to avoid any adverse tax consequences of investing or moving money overseas.” Sadly, many people overlook this seemingly small detail before making what could be one of the biggest financial decisions of their lives.

Find out more about what Dave has to say about avoiding making major tax mistakes by reading The Expatriate Guide to Managing Money and Taxes. For Jewish Press readers, get half off the regular price of the book by using the discount code JPRESS. Go to www.ExpatGuideToMoney.com and order now. The discount will expire on tax day, April 15th.

Knowledge is power, and reading this easy-to-follow guide for U.S. expats you can stay in full compliance with the law.

About the Author: Douglas Goldstein, CFP®, is the director of Profile Investment Services, Ltd, a financial planning and investment services firm located in Jerusalem. He specializes in working with clients who live outside of the United States and want to maintain a U.S. brokerage account. Doug’s newest book, co-authored with Susan Polgar, about how using chess strategies to improve your finances, Rich As A King can be purchased at www.richasaking.com. He is a licensed financial professional both in the U.S. and Israel. Securities offered through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, FSI. Accounts held at Pershing LLC., Member NYSE/SIPC, a subsidiary of The Bank of New York Mellon Corporation. Neither Profile nor PRG gives tax or legal advice. Before immigrating to Israel, it is advisable to consult with a tax attorney who is knowledgeable about Israeli law. Contact at doug@profile-financial.com

The author's opinion does not necessarily reflect the opinion of The Jewish Press.

If you don't see your comment after publishing it, refresh the page.

Our comments section is intended for meaningful responses and debates in a civilized manner. We ask that you respect the fact that we are a religious Jewish website and avoid inappropriate language at all cost.

If you promote any foreign religions, gods or messiahs, lies about Israel, anti-Semitism, or advocate violence (except against terrorists), your permission to comment may be revoked.

One Response to “Three Mistakes that Can Get You in Big Trouble”

  1. Might I suggest active investment in global mining equities for very high yields. The trick is to identify small companies with world class assets upon which you don't have to recognise an income until they offer a return. You simply need to be assured of the right type of project and the timing. i.e. when those companies cease to have uncertain cash inputs, upon which you can project a cashflow, i.e. net present value with a lot of confidence.

Comments are closed.

Current Top Story
Bibi conf call
Bibi: ‘Keep or Cheat,’ This Deal Will Give Iran the Bomb
Latest Blogs Stories
yeshivaresized flash 90.jpg

Surprisingly, many Hareidi communities do not advocate full time Kollel study for life as the ideal.

Baim-061915-Mazal-Tov

“You’ve been out on enough dates, are you going to marry him?” Many times I’ve choked at this point.

Shira Banki, 16, z'l

What is left to say when a 16 year-old is dead? How will her mother and family endure without her?

Bloodstained car after Palestinian Authority terrorists shot at settlers

Compare the numbers. Disproportionately too many Arab attacks on Jews have been happening.

What is the impact of renouncing US citizenship if you live abroad? Can you visit the US again?

Gentile friends of Israel came from all over Norway & Europe and they sang “Hatikva” in Norwegian!

As the incitement begins again against the settlers, the religious and the Right, let’s review the list of children killed by terrorists.

Reports of a dead baby, a devastated family, and indications of a gloating attacker.

In all the years (and this week it’s exactly 14 years) since our daughter was murdered, we have not found a single Arabic-language post, article, tweet or speech condemning that attack in the center of Jerusalem or the killings.

Everyone is angry at the ongoing Arab terrorism, but what does murdering a baby have to do with protecting Jewish lives or furthering Jewish settlement in the Land of Israel?

Tonight, live Meerkat interactive video tour and talk in Jerusalem.

The US doesn’t want Pollard & he doesn’t want America- release him with 1 condition: No return to US

Meet Republican US presidential candidate Kerry Bowers & listen to his message to the Israeli public

Amongst the Palestinians (sic) what is promoted and praised for its young people? Terror & martyrdom

“If you can’t negotiate with your enemy, why negotiate at all?” Great sound bite. The press loved it

The phenomenon pushing limits of Orthodoxy to the extreme left has no chance of becoming mainstream

More Articles from Doug Goldstein, CFP®
Doug Goldstein

What is the impact of renouncing US citizenship if you live abroad? Can you visit the US again?

Doug Goldstein

Meet Republican US presidential candidate Kerry Bowers & listen to his message to the Israeli public

Discussing, what should you do if you are feeling overstressed in your job and are tempted to quit?

Learn how modern technology can be used to foster personal development in life as well as in finance

Tony Stubblebine, founder of Coach.me, shares tips on translating desire for change into action

Talking about the best ways to give financial advice. Is “storytelling” helpful?

How can you get people motivated in the right way? Discover effective techniques right here.

Learn how discipline helps you reach your potential and the role good habits play in being a leader.

Printed from: http://www.jewishpress.com/blogs/goldstein-on-gelt/three-mistakes-that-can-get-you-in-big-trouble/2013/03/31/

Scan this QR code to visit this page online: