euinvestor123
Confused about dryer sheets
- Joined
- Oct 7, 2019
- Messages
- 1
I am currently working in the US on a green card and will be able to FIRE in 5 years time. I plan to use the usual approach with diversified ETFs which most people use. I plan to leave the US once I am done and move back to Europe. I will be careful to stay less than 8 years on the green card to avoid the US exit tax and will officially give up my green card. I have contacted some brokers in the US who will let me keep my brokerage account but they will not let me buy new ETFs once I move so when I rebalance dividends I will have to use UCITS ETFs.
My questions:
1. Is it worth for me to contribute to the 401k from my employer? I will likely contribute up to the match but is it worth doing more? I will only be working for 5 years. I am unsure how this account will be treated once I stop being a ”US person”? Will Roth ladder work for me?
2. Is it worth for me to contribute to IRA? My understanding is that due to income restrictions I can only contribute to a non deductible IRA and only 6000 USD/year. How is this account treated once you stop being a ”US person”?
3. Most of my investments will be in a taxable account and with US domiciled ETFs. Once I move, is it recommended that I liquidate everything and buy equivalent non-US domiciled ETFs? Is this only for estate tax reasons or are there other concerns? I read that I may have to move to a country without capital gains tax for a while to make sure I don’t pay excessive tax. How does this work in practice and what countries are good for this? I rather not stay longer than 1 year if possible.
4. One alternative is to stay in the US until I get citizenship and then move to Europe. However, I have read about a lot of problems that US citizen ex-pats face. I assume that the best choice is to leave the US before I qualify for the exit tax. Is this the general consensus or am I missing something? Does anyone know if the years on an EAD count towards the total 8 years for exit tax purposes or is it only the years on a green card?
5. How would currency risk work if my investments are in USD but I live in Europe. Would this somehow balance out given large international presence of major US companies or should I have all investments in my own currency?
6. What are recommended stock brokers for my situation? I assume I need a US broker in the accumulation phase but once I am done where should I place the investments? Would it not be good to keep them in the US because it is relatively safe there and the taxes are low (at least compared to many European countries)?
My questions:
1. Is it worth for me to contribute to the 401k from my employer? I will likely contribute up to the match but is it worth doing more? I will only be working for 5 years. I am unsure how this account will be treated once I stop being a ”US person”? Will Roth ladder work for me?
2. Is it worth for me to contribute to IRA? My understanding is that due to income restrictions I can only contribute to a non deductible IRA and only 6000 USD/year. How is this account treated once you stop being a ”US person”?
3. Most of my investments will be in a taxable account and with US domiciled ETFs. Once I move, is it recommended that I liquidate everything and buy equivalent non-US domiciled ETFs? Is this only for estate tax reasons or are there other concerns? I read that I may have to move to a country without capital gains tax for a while to make sure I don’t pay excessive tax. How does this work in practice and what countries are good for this? I rather not stay longer than 1 year if possible.
4. One alternative is to stay in the US until I get citizenship and then move to Europe. However, I have read about a lot of problems that US citizen ex-pats face. I assume that the best choice is to leave the US before I qualify for the exit tax. Is this the general consensus or am I missing something? Does anyone know if the years on an EAD count towards the total 8 years for exit tax purposes or is it only the years on a green card?
5. How would currency risk work if my investments are in USD but I live in Europe. Would this somehow balance out given large international presence of major US companies or should I have all investments in my own currency?
6. What are recommended stock brokers for my situation? I assume I need a US broker in the accumulation phase but once I am done where should I place the investments? Would it not be good to keep them in the US because it is relatively safe there and the taxes are low (at least compared to many European countries)?