Tax residence for expats

[BoodaGazelle]

On the off-chance that the august members of this forum may know the answer, I figured I would give this a shot.

My brother has lived abroad for at least 20 years. A few years ago he finally sold his home here in the US, which he had been renting.

Yesterday, he told me that as a “nomadic expat”, he needs to (re)establish a US address to get Social Security (he will be 62 in May).... He asked if he could put our address as his US address, stating that it “would require very little of you”, although he did not indicate what that would be.

I did some quick searches, but did not find anything exactly like what I thought he was asking. As I have no knowledge of what his tax status has been all of these years, and do not know what, if any, legal repercussions this could have for us, I asked him to send more details.

If anyone knows what this would mean to us to allow this, I would appreciate hearing your experiences.

Thanks,

Bood

 

[MichaelB]

He wants to use your home address as his US mailing address? I used my parent’s home as my US mailing address for many years and our son (who lives abroad) uses our current address as his US mailing address.

If he does, there’s no exposure to you. There might be to him, if the state were to decide he has some tax liability, but that’s not likely to happen.

If he is a US citizen he does not need to reside in the US to receive Social Security Benefits.

If he needs to prove US residency for some other reason, just having a mailing address is not enough. That is something that should not involve you and you probably shouldn’t get involved.

 

[mexexpat]

Many friends here in MEX get their SS check sent directly to their MEX bank and use their MEX address. It is not a problem for SS. There are a few countries that SS will not send benefits to directly, Cuba and North Korea come to mind.

There is an SS liaison at the Guadalajara US consulate and I assume that is fairly common in countries where expats reside.

Here is link to SSA booklet for expats.
https://www.ssa.gov/pubs/EN-05-10137.pdf

 

[braumeister]

If he is a US citizen he does not need to reside in the US to receive Social Security Benefits.

If he needs to prove US residency for some other reason, just having a mailing address is not enough. That is something that should not involve you and you probably shouldn’t get involved.

Exactly right. Plenty of retirees living outside the US receive their Social Security without a US address (except for a certain few countries).
https://www.ssa.gov/pubs/EN-05-10137.pdf

 

[HarveyS]

I am under the impression that US citizens living abroad need to file a US tax return, and need to have a US address to do so. Have I been wrong this whole time?

 

[MichaelB]

I am under the impression that US citizens living abroad need to file a US tax return, and need to have a US address to do so. Have I been wrong this whole time?

There is no need for a US address to live abroad or file taxes.

 

[bada bing]

When I was expat, the companies I worked for did my USA taxes (as a condition of employment). They wanted to make sure that USA taxes were filed (including SS) to cover themselves as well as keep their employees on the up-n-up. I had a legitimate USA residential address, but some of my work peers just used a rental P.O. box in their old home town with a mail forwarding service.

I think most mega-corp employers of USA expats have similar due diligence with respect to their employee's home country tax status.

 

[BoodaGazelle]

Thanks to all for the information. I will also wait and see what documentation he will provide for exactly why he thinks he needs this.

 

[Alan]

I am under the impression that US citizens living abroad need to file a US tax return, and need to have a US address to do so. Have I been wrong this whole time?

We are both USCs living abroad and USCs living abroad are always considered resident for tax purposes but do not need a US address. When we file we have our UK address on the return and that more than doubles the limits for FATCA reporting to the IRS. ($400k at end of year or $600k when filing MFJ).

FBAR reports are required whether US resident or not and that limit is still $10k.

 

[Alan]

On the off-chance that the august members of this forum may know the answer, I figured I would give this a shot.

My brother has lived abroad for at least 20 years. A few years ago he finally sold his home here in the US, which he had been renting.

Yesterday, he told me that as a “nomadic expat”, he needs to (re)establish a US address to get Social Security (he will be 62 in May).... He asked if he could put our address as his US address, stating that it “would require very little of you”, although he did not indicate what that would be.

I did some quick searches, but did not find anything exactly like what I thought he was asking. As I have no knowledge of what his tax status has been all of these years, and do not know what, if any, legal repercussions this could have for us, I asked him to send more details.

If anyone knows what this would mean to us to allow this, I would appreciate hearing your experiences.

Thanks,

Bood

I can confirm that no US address is needed to collect SS, and that it can be paid directly into most foreign bank accounts. Here in the UK we apply for SS through the US embassy in London.

The only wrinkle I would foresee is if he hasn’t been filing US tax returns during the 20 years he has been away, then claiming SS may mean him poking his head above the parapet and having questions asked when they check his SS contributions record.

 

[BoodaGazelle]

Alan, I also wonder, but do not know, how accurately he has obeyed tax laws during his many years abroad. Although he have take offense at me asking these questions, I want to make sure I am not breaking any law(s) by somehow asserting that he really does live at my US address.

 

[Alan]

Alan, I also wonder, but do not know, how accurately he has obeyed tax laws during his many years abroad. Although he have take offense at me asking these questions, I want to make sure I am not breaking any law(s) by somehow asserting that he really does live at my US address.

That is exactly what I was hinting at. He really has no need to use your address for either claiming SS or filing taxes so if I were you I would simply tell him that you have asked around and been assured that he does not need a US address or US bank account to claim SS.

 

[Sunset]

We are both USCs living abroad and USCs living abroad are always considered resident for tax purposes but do not need a US address. When we file we have our UK address on the return and that more than doubles the limits for FATCA reporting to the IRS. ($400k at end of year or $600k when filing MFJ).

FBAR reports are required whether US resident or not and that limit is still $10k.

Annoyingly low value.

 

[Sunset]

....

My brother has lived abroad for at least 20 years. A few years ago he finally sold his home here in the US, which he had been renting.

Yesterday, he told me that as a “nomadic expat”, he needs to (re)establish a US address to get Social Security (he will be 62 in May).... He asked if he could put our address as his US address, stating that it “would require very little of you”, although he did not indicate what that would be.

..

Wow.... He must have been filing a US tax return all those years for the rental, and taken the depreciation on it, or he is going to have a very complex issue to resolve.

 

[Aerides]

I would not agree to anything using your info for your brother to file, unless you both meet (together) with a tax lawyer to ensure everything is legal, including his audit-able past.



(PS, your brother won't show up to that meeting).

 

[Alan]

Annoyingly low value.

Indeed. The penalties for not filing have increased dramatically, but the reporting threshold has never increased.