Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Assuming you move to a no tax state.....Wyoming, Washington, Texas, South Dakota, Nevada, Florida, Alaska) when you retire, do you just pay the federal taxes on your 401k withdrawal?
what if you move to another country when you retire? do you still pay the US fed tax on your withdrawal AND income tax in the new country? or is it one or the other?
Assuming your are over 59.5, you would just pay the applicable Federal Income Tax rate if you live in a Income Tax Free State.
If you depart the US, You still pay Federal Tax in the US, you might have Tax in the other country also. (You may also need to take steps to "renounce" living in your old state if that had a income tax). You might want to get a US mailing address at a mail forwarder in a "Tax" friendly state.
Fed only if you move to a no tax state. As for moving to another country, it would depend on the country whether there's a treaty exception for retirement income. As long as you maintain your US citizenship, you're taxable on your world wide income in the US.
There are a number of countries you can move to and pay the total of the higher rate. Example if you move to Spain and your income tax rate there would be 28% and it would be 25% in the US you still have to file a US return but won't owe additional taxes. Conversely if the rates swapped you would only owe 3% to the US. This is very rough but I believe with certain countries and tax treaties it can work like this
Fed only if you move to a no tax state. As for moving to another country, it would depend on the country whether there's a treaty exception for retirement income. As long as you maintain your US citizenship, you're taxable on your world wide income in the US.
So one could renounce their US citizenship and pay no Fed tax on 401K?
so...technically, one could 'game the system' by withdrawing only 13k a year (current limit for a head of household) and not pay any taxes on their 401k stash....right? assuming of course they've allocated enough money in other accounts (IRAs, cash, etc.) to supplement the rest of the income they'd need in retirement...
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
