Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 04-24-2011, 11:09 AM
Junior Member
 
Join Date: Apr 2011
Posts: 1
Foreign dividends

I am a US alien resident. I have income into the US, for which I pay regular taxes and I have dividends from my own Brazilian company. I receive those funds as dividends and I don't have to pay additional taxes in Brazil because the company already pays for that income.
Last year I was 298 days out of the USA. How is the tax treatment for that kind of funds?
Thanks,



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 04-24-2011, 04:31 PM
Moderator
 
Join Date: Oct 2010
Posts: 5,258
“Last year I was 298 days out of the USA. How is the tax treatment for that kind of funds?”--->Basically, either as a US citizen or a US resident alien UNDER either US Tax Law or US INS Rules, you are liable for US taxes, both federal and state( if your state imposes taxes on its residents; 9 states do NOT impose income taxes on their residents.) on your World wide income and US source income. I guess as you are physically present in the foreign country for 298 days(IF less than 330 days during a 12-month period), you are NOT subject to foreign earned income exclusion credit on your US federal return. However, as long as you pay taxes to the foreign taxing authorities on your income that you earned in the foreign country( if you have), you can claim your foreign tax credit on your federal return, NOT on your state return by filing form 1116 and report it on 1040 line 47 or on 1040 Sch A line 8.However, as yu don’t pay CG tax on the portfolio income, dividend income in Brazil, I mean, you are subject to both federal and state income taxes on your Brazilian dividend income on your return. You need to file Sch D for the dividend income and are subject to wither 0% or 15% LTCG tax rate in US; I fyour marginal tax bracket in 2011 is 15% or less, then you do NOT pay LTCG tax on your dividend income. As long as your marginal tax rate in US is higher than 15%, then you are subject to your LTCG tax, 15%, on your Brazilian dividend income.
Please visit the Website here; Capital gains tax in the United States - Wikipedia, the free encyclopedia



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Can I take foreign tax credit or deduct taxes paid on foreign investments in IRA? jswift IRA/Sep 0 02-14-2010 02:03 AM
IRA Account & Dividends tc93 IRA/Sep 1 02-04-2010 11:01 PM
How are Dividends taxed in 2008? mabalone Income 1 07-21-2008 12:18 PM
At what rate are dividends taxed? Ralph Harris Capital Gains 1 04-10-2008 12:53 AM
What are Constructive Dividends? TaxGuru C-Corporation 1 12-12-2007 09:58 PM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning
 
 
 

» Recent Tax Q&A
No Threads to Display.