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Financial Planning / Tax Strategies
|Subject: Re: Renouncing citizenship for tax purposes||Date: 8/22/2013 8:55 PM|
|Author: JeanDavid||Number: 119061 of 124817|
Well, at the risk of stating the obvious, such people might consider complying with the US tax rules, filing the required documents, and paying their fair share like the rest of us do. Why is this such a problem?
I am a (naturalized) U.S. citizen living in the USA. But I have an annuity from a Swiss insurance company that pays me a pittance each year. If they would issue me a 1099-R, I would have no problem. I do choose to pay my tax due on this. But it is not easy because the Swiss Insurance company does not issue 1099-R forms.
So I try to make TaxAct give me a blank 1099-R form and it does that, but unless I give the Swiss insurance company's EID, I cannot get TaxAct to accept it. And the Swiss insurance company has no US EID.
I know what I do. Each year I e-mail the Swiss insurance company and ask what portion of the payment is a return of principle, and what portion is interest. I put the interest into 'other income' on the 1040 someplace. Then TaxAct complains that, since it is over $400, my return will be held up by the IRS and I am likely to be audited. The IRS does not seem upset by this procedure. They take what they think is their fare share, and never bother me. As far as I can tell (I file electronically) they do not hold up processing my return, and if they audit me, they do it with no participation from me.
But I think it is a problem to comply with the law even in what seems to me to be a very simple situation. Actually, if I managed to file a 1099-R for this, it would probably make trouble, since the Swiss insurance company files nothing with the IRS.
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