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Author: austellga Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75339  
Subject: Expat Dilemma2 - Roth IRA Date: 6/4/2005 1:52 AM
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I am an expat living in Tokyo. Given the incredibly high cost of living($10,000 a month rent), my company compensates the differential reported as part of my payroll. This puts me way over the Roth IRA limit. Does this mean I can not contribute toRoth IRA or is there a special tax provision given my situation?

Austell
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Author: jrr7 Big gold star, 5000 posts Feste Award Nominee! Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46329 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/4/2005 10:00 AM
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Are you paying taxes to the US or to Japan?

Are you taking advantage of the provision in US tax law for ignoring money earned outside the country?

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Author: fredinseoul Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46338 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/4/2005 6:09 PM
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Generally, you income earned in Japan is not eligible for a ROTH IRA anyway. The money you earn in Japan is tax free, you can't contribute this to a ROTH. You can still do a traditional IRA, I believe. Try to find an HR Block office, they should be able to tell you more details.

fredinseoul

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Author: austellga Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46339 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/4/2005 7:17 PM
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Are you paying taxes to the US or to Japan?

Are you taking advantage of the provision in US tax law for ignoring money earned outside the country?


--
I am paying both US and Japan taxes. My company tells me that the "delta" they pay me for Tokyo expenses is tax compensated. My YTD pay shows the "delta".
An accounting firm handles filing; but they will not advise me unless I hire them separately.

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Author: austellga Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46340 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/4/2005 7:18 PM
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I should also clarify that all my earnings come from USA only. They pay me in USA. I just transfer the money to Tokyo

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Author: bogwan Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46347 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/5/2005 12:17 PM
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Is your primary residence in the US or Tokyo? My guess is that is what will determine things. The rule of thumb (not the law) is that money contributed to an IRA must be earned (you paid social security tax on it).

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Author: pastohr Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46376 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/7/2005 4:49 PM
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My experience with expat-related compensation (housing compensation, utilities, etc that are usually subsidized) is that it does count towards the limits for IRAs, 401(k)'s, and all other things that have limits for benefits to highly compensated folks.

When I was abroad, I argued to my company that assignment related bonuses and payments should not affect my 401(k) contribution limits, ie being considered highly compensated. They agreed and allowed me to contribute the max. However, during a plan audit last year, they ruled that I had over-contributed and returned the money (to be taxed).

There are no special tax provisions that I know of to provide credit for assignment related payments. It's all viewed as income to the employee.



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Author: austellga Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 46406 of 75339
Subject: Re: Expat Dilemma2 - Roth IRA Date: 6/8/2005 10:42 PM
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My experience with expat-related compensation (housing compensation, utilities, etc that are usually subsidized) is that it does count towards the limits for IRAs, 401(k)'s, and all other things that have limits for benefits to highly compensated folks.

When I was abroad, I argued to my company that assignment related bonuses and payments should not affect my 401(k) contribution limits, ie being considered highly compensated. They agreed and allowed me to contribute the max. However, during a plan audit last year, they ruled that I had over-contributed and returned the money (to be taxed).

There are no special tax provisions that I know of to provide credit for assignment related payments. It's all viewed as income to the employee.
======================
It is good know your experience. I have a start point.


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