Guest DDDlump Posted May 22, 2002 Posted May 22, 2002 An employee has resided in the US for 2 years and will continue to work here for an additional 3 - 5 years. She is wondering whether or not she should participate in a 401(k) plan. What would be the consequences to her when she returns to Brazil. What would be her options with regards to the balance in the plan?
mbozek Posted May 22, 2002 Posted May 22, 2002 All taxable amounts distributed to a foreign national under a qualified plan are subject to us income taxation because qualified plan distribitions are us source income. Only exception is if there is a tax treaty exempting the income from us taxation. Check IRS publication on US tax treaties to see if ther is any exemption for pension income. Its on IRS web site. mjb
david rigby Posted May 22, 2002 Posted May 22, 2002 IRS list of treaties. http://www.irs.gov/pub/irs-trty/ I'm a retirement actuary. Nothing about my comments is intended or should be construed as investment, tax, legal or accounting advice. Occasionally, but not all the time, it might be reasonable to interpret my comments as actuarial or consulting advice.
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