With the development of China's economy, most of today's China immigrant applicants are not short of money, especially EB-5 investment immigrants from multinational companies and EB- 1C executive immigrants are becoming more and more popular in China, and most of these immigrant applicants have considerable income in China and even in other countries in the world. For them, "global tax return" to the US government has become a serious issue that they need to consider before becoming American taxpayers. How to deal with the new US tax regulations (FATCA) and avoid global tax returns?
At the end of last year, the United States promulgated the new FATCA law, which is used for the disclosure of overseas financial assets and the tax declaration of value-added of American taxpayers. Since then, we have received many inquiries about this law from immigrant applicants from China and some H- 1, L- 1 visa holders. First of all, it must be clear that this new regulation is only aimed at taxpayers' overseas financial accounts and assets, not all overseas assets. In addition, the new bill will still not tax financial assets, only require disclosure, and only require tax returns on income. Next, let's take a closer look at the provisions of the new bill.
Form 8938
For American taxpayers who meet the requirements of FATCA, form 8938 needs to be filled out and submitted to the IRS together with form 1040NR before April of 15. It is worth noting that the United States began to implement a set of laws on the disclosure of overseas banks and financial accounts (FBAR) as early as 2004, and on March 28, 20 1 1, the US Treasury Department completed the final revision of this law and put it into formal implementation. Although the newly published FATCA Act and the previous FBAR Act seem to disclose the information of American taxpayers' overseas financial accounts, when we open the 8938 form required by FATCA Act and the TD F 90-22. 1 form required by FBAR Act, we can find obvious differences:
First of all, in addition to information disclosure, 8938 also needs to fill in the amount of overseas income (interest, dividends, taxes, etc. ); TD F 90-22. 1 form only needs to fill in the account information, and does not need to fill in the income or the appreciation of financial assets.
In addition, in terms of submission, 8938 requires that it be submitted to the IRS together with the tax return of 1040NR before April 5, but the form TD F 90-22. 1 requires that it be submitted to the US Treasury on June 30, and specifically indicates that it should not be submitted together with the tax return.
It can be seen that the previous FBAR Act tends to disclose the information of overseas financial assets, while the FATCA Act tends to declare the tax returns of overseas income. FATCA also specifically states that taxpayers who meet the requirements of Form 8938 are still required to submit Form TD F 90-22. 1 if they also meet the requirements of Form TD F 90-22. 1. The two bills do not cover each other.
How to deal with the new US tax regulations (FATCA) and avoid the information required for global tax returns?
Conditions for submitting Form 8938
Identity of the declarant
American citizens;
Permanent resident of the United States; or
Non-immigrant visa holders who meet the "substantial residence test", such as some H- 1, L- 1 visa holders and so on.
Property category
The categories of assets that need to be declared to the United States include:
Financial accounts of overseas financial institutions; and
Although not in an overseas financial institution, the holder uses the following financial assets for investment:
Stocks or other securities issued by non-American companies;
Any capital in an overseas entity; and
Any financial commodity or contract with an overseas entity as the issuer or counterparty.
Overseas financial institutions include other overseas investment institutions besides overseas banks, such as mutual funds, hedge funds and other private investment funds.
For financial assets, we need to pay attention to the concept of "for investment". For example, for real estate, private property that obviously belongs to personal use is not a financial asset, while the shares of real estate companies used for investment are financial assets.
Other forms, such as Form 2555, are used for tax declaration of offshore non-financial assets.
Threshold of declared amount
The taxpayer is unmarried and lives in the United States: at the end of the tax year, the total foreign financial assets exceed US$ 50,000, or exceed US$ 75,000 at any time in the tax year.
The taxpayer is married and lives in the United States, and has jointly declared with his spouse that the total amount of overseas financial assets at the end of the tax year exceeds US$ 654.38+million or exceeds US$150,000 at any time during the tax year.
The taxpayer is married and lives in the United States, but the total amount of overseas financial assets independently declared at the end of the tax year exceeds 50,000 US dollars or exceeds 75,000 US dollars at any time during the tax year.
Taxpayers who live outside the United States independently declare that the total amount of overseas financial assets exceeds US$ 200,000 at the end of the tax year or exceeds US$ 300,000 at any time during the tax year.
Taxpayers who live outside the United States but live with their spouses declare foreign financial assets totaling more than US$ 400,000 at the end of the tax year, or more than US$ 600,000 at any time in the tax year.
For American taxpayers who are not American citizens, living outside the United States means that they have been outside the United States for at least 330 days in 12 months in a tax year.
Punishment for failure to declare according to law
According to the new regulations, failing to declare overseas financial assets according to law will face a maximum fine of $65,438+0,000. If you fail to declare or pay taxes according to law after being notified by the IRS, the fine will rise to $50 thousand. For the part that is not fully declared, the maximum penalty is 40% of the insufficient part.
Traceability of overseas income (recovery)
First of all, it is clear that foreign citizens do not need to declare their income outside the United States to the US government before they meet the "substantial residence test" or "green card test". In the year when you become an American taxpayer, you can choose to file global income tax returns in the United States from the day you become a taxpayer, or file global income tax returns in the United States all year round. The introduction of the new regulations has no impact on this basic law, so foreign citizens still don't have to worry that the new law will trace the global income before obtaining a green card or meeting the conditions of "substantive residence".
In addition, according to the new regulations of FATCA, this regulation is applicable to the disclosure of taxpayers' overseas financial assets after March 20 10, that is, the tax return of 201year is applicable. In addition, once again, foreign citizens' overseas financial assets will not be taxed, but only need to be disclosed, and tax returns are required for value-added assets, that is, the income part.
The United States tracks the trend of taxpayers' overseas financial assets
Another important part of FATCA's new regulations is to require banks and other overseas financial institutions operating in the United States to join the agreement with the IRS before June 30, 20 13. The main content of the agreement is that these overseas financial institutions must conduct specific identity investigations and other due diligence on their depositors and report relevant information about their American depositors to the IRS. Overseas financial institutions that do not participate in the agreement must withhold and pay 30% of their US income to the IRS. This is a heavy blow to the United States to thoroughly investigate taxpayers' overseas financial assets. In this way, those gray areas that were once used for tax avoidance will be further eliminated.
The influence of overseas financial assets declaration on "resident foreigners"
As mentioned earlier, the 8938 form required by the new bill is an overseas income tax return, in which the foreign income to be filled in includes interest, dividends, royalties and other income. For China citizens who become "foreign residents" in the United States, although there is an agreement between the United States and China to avoid double taxation and prevent tax evasion on income, it is still possible for these China citizens to pay tribute to "Uncle Sam" after paying taxes to the China government because of the different tax systems in the United States and China.
Although at present, taxpayers' overseas income is still a conscious principle, once FATCA fails to fully implement the plan of requiring overseas financial institutions to disclose customer information to the IRS as scheduled, with the disclosure of customer information by these overseas financial institutions, the appreciation and trend of their overseas financial assets will be unobstructed by the IRS, and more tax avoidance schemes will become a bubble.
Suggestions on how to deal with the new US tax regulations (FATCA) and avoid global tax returns.
"Global tax return" may indeed mean higher taxes for some immigrant applicants with high overseas income or some non-immigrant visa holders who have lived in the United States for a long time, especially some L-/KLOC-0 visa holders. However, as far as the principle of reciprocity of rights and obligations is concerned, enjoying a country's welfare must bear the tax obligation. Moreover, it seems a bit funny to give up the "American dream" just because you don't pay taxes to the US government. As a balance point, applicants should make long-term tax planning before they become American taxpayers who need to file global tax returns, so as not to violate American laws and give up the "American dream". You can refer to our other article "Tax Avoidance Plan before High-asset People Become" Foreign Residents in American Tax Law "or consult our lawyers.
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American EB-5: Introduction of Charter School Project
American EB-5 investment immigration is one of the fastest and most convenient ways for the whole family to get the American green card. Since entering the Chinese mainland market in 2004, EB-5 has experienced a wait-and-see and slow development in previous years, and has become the most important investment immigration project with a strong momentum in the last three to five years. Following the great success of the first nine phases of the American Investment Immigration to Florida Charter School Project, there are only a few places left in the 10 phase, and the American Investment Immigration to Florida Charter School Project 1 1 phase is another masterpiece launched by Qiao Hong immigrants, which is shocking and very popular. Please register quickly. The following is a brief introduction to the tenth project of charter schools:
Brief introduction of the tenth issue of Florida charter school project
1. It was directly named by the EB-5 regional center of the U.S. government, fully funded by the Florida government, and vigorously promoted by Florida Governor Rick Scott and Florida Department of Commerce.
2. The previous phases of 1-9 have achieved great success, and now it is a demonstration project of EB-5 investment immigration project!
3. The project model has been approved by USCIS, and the project assets have been evaluated by CBRE, the largest real estate company in the world.
4. With high employment creativity exceeding the standard of 55%, USCIS requires 465,438+00 jobs, and the project will create about 634 jobs (construction and school operation).
5. Clear return strategy, EB-5 loan is guaranteed by school buildings, land and rental income. The main bank (PNC Bank) finances 80% to 90% of the funds for the construction of charter schools. Click here to see what American charter schools are/detail _1248.html.
The Florida Overseas Investment Regional Center is the only regional center approved by the US Immigration Bureau to operate educational facilities in Florida, and it is also one of the eight regional centers proposed by the US Immigration Bureau as other learning regional centers.
Qiao Hong immigrants joined hands with Florida Overseas Investment Regional Center. So far, they have successfully sold the EB-5 project series of 1 to 9, and there are only a few places left in 10, which is being hotly subscribed. 1 1 projects are on sale, and each project has been highly recognized and welcomed by customers. At present, customers have
Qiao Hong immigrants always adhere to the principle of beginning and ending when promoting American investment immigration projects. Qiao Hong's high-level immigrants made many field visits and paid a return visit to the progress of the project. Almost every project's information from the previous visit to the later visit was fed back to Qiao Hong's customers at the first time, so that customers could fully understand it in time and apply for American investment immigrants with peace of mind!