AboutGlenn D Schnabel Expertise I can answer most federal individual income tax questions.
I can not provide legal advise.
Experience I have worked for a CPA firm for over 11 years.
I have worked in private as well as government
I have recently been running a tax preparation office, mainly focusing on
individual income taxes
Organizations I have been affiliated with managing condo associations and as a member of a coalition to educate condo owners as to their rights and responsibilities.
Education/Credentials I have my B.S.B.A in Business Administration . Concentration in Accounting
I have gone to yearly tax seminars and have tried to keep up with the
evolving tax changes
Awards and Honors Over my years I have received local awards for contributions to worthy
organizations.
Past/Present Clients This, of course remains confidential
Expert: Glenn D Schnabel Date: 7/18/2008 Subject: Taxation of retirement funds
Question I am leaving my company in Switzerland and moving to California,USA .What happens to my Swiss retirement funds savings if I transfer the money I receive ( after being taxed by Switzerland ) to USA before my employment begins in USA ?? What happens if I do so after my employment begins ...Will my savings be taxed once more and if yes,at what rate ??
Thanks
Answer Ugur,
Thank you for your question.
1)What happens to my Swiss retirement funds savings if I transfer the money I receive ( after being taxed by Switzerland ) to USA before my employment begins in USA ??
If you paid taxes on this money in Switzerland before you transfer the funds, then you would not be taxed on the money in the US. You would only be taxed on any earnings you make from the retirement year by year.
2)What happens if I do so after my employment begins .
It does not matter. The same would apply
3)Will my savings be taxed once more and if yes,at what rate ??
The same would apply. Once you were taxed by Switzerland and you bring over the funds to the US, you will be taxed on any earnings you make going forward.
We have a progressive income tax. We use different rates depending on how much income is reported. We add W-2 (earnings), interest and dividends, etc...less itemized deductions (medical, interest exp, taxes, and miscel deductions) less exemptions to arrive at taxable income.
Forgive me while I digress.
In this country, we defer taxes on retirement, until the person reaches 59 1/2, then there are minimum distribution requirements and only then do we tax the earnings. The money is considered "pretax", hence no taxes being charged.
In this country, we don't tax money put in regular accounts, Certificates of Deposits, etcc. until the "principal" earns interest, and therefore the interest only is taxable. This is a simple example.
