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Date: Mon, 4 Jun 2007 09:10:17 -0700 (PDT)
Hi Patrick,
As a green card holder, you have to file US tax returns no matter where you reside.
However, this does not mean you will owe taxes to the United States. Right now the foreign earned income exclusion is $82,400 and you can credit the Swiss taxes you will pay to your US tax return. However, expat tax law has changed in 2006 and tax rates are computed before the exclusion is taken...this can be complicated and I advise you to see an expat tax specialist for advise. I know one specialist in Nyon if you are interested.
This would be very useful also if you are thinking of giving up your green card, it is a complicated process and you have to make sure you do it properly. After you give up your green card and depending on how long you held it, it is true that you might have to file US tax returns for the next 10 years. However, you will only need to state US effectively connected income, not worldwide income.
Concerning the 401(k), if you withdraw it now, you will have to pay taxes on the amount withdrawn plus a 10% penalty. Having it rolled forward to and IRA is more advantageous in that regard.
Sincerely yours,
Maria
Received on Mon Jun 04 2007 - 19:37:09 PDT
