4 ms·
> Capital gains is deferred every year that you don’t sell an asset I think that's a slightly odd way to think about it, the tax is due when you actually have
by OJFord 3y ago
> Capital gains is deferred every year that you don’t sell an asset
I think that's a slightly odd way to think about it, the tax is due when you actually have a capital gain, which in the ordinary course of just owning something you don't.
Of course, many countries don't want to miss out on that just because you moved before you sold, so change in tax residency becomes an event that triggers it as if it had been sold.
What's unusual about the US (currently) is that citizens worldwide are considered resident for tax purposes (as other countries would call it I suppose, since it's typically more about residency than citizenship) whatever their living and working arrangement and wherever else tax may be due.
If it weren't for that, probably nothing about renouncing citizenship would be controversial, because it would be a much more niche desire. Surely the main reason to do it is because you moved and wish to be free of 'doing taxes' (maybe you moved somewhere where that's not even something you have to think about!) in the US?
- Retric 3y agoYour property taxes are adjusted to changes in the value of the land. So, you might owe twice as much on some investment property after you build a hotel, but capital gains on that land isn’t assessed every year. Arguably it’s simply a question of practicality as nobody can accurately assess how much a painting is worth until it’s sold. Still, it definitely incentivizes bonds which pay on maturity rather than every year.
- seanmcdirmid 3y ago> What's unusual about the US (currently) is that citizens worldwide are considered resident for tax purposes (as other countries would call it I suppose, since it's typically more about residency than citizenship) whatever their living and working arrangement and wherever else tax may be due. For most people who aren't insanely rich or aren't getting most of their income via a trust fund, this isn't very relevant. You have the foreign income exclusion (somewhere north of $100k now) and the foreign taxes paid deduction to insulate you from playing taxes in the states. The problem becomes when you are making > $100k in a low tax place like Singapore or Dubai, but even then there is a housing deduction that works for most working class people. > Surely the main reason to do it is because you moved and wish to be free of 'doing taxes' (maybe you moved somewhere where that's not even something you have to think about!) in the US? It isn't hard to file if you have simply income to consider. I did it by hand for many years, it took around 15-30 minutes a year.