[Carl and Liz]

Hi Everyone,

The house has sold and we are almost ready to make the leap but wanted to iron out some tax issues first:

1. Does the NZ tax on worldwide income include income earned in US retirement accounts such as IRAs and company pensions?

2. Is there any sort of pre-migration strategy we should employ to minimize NZ tax on our cash investments we're leaving in the US? For example, if we put those assets in a trust can we minimize the NZ tax we pay on it?

3. I have recently completed the sale of two properties - one is an investment property subject to capital gains tax in the US and the other is the sale of a primary residence which is not subject to capital gains in the US. Will NZ tax me on the income generated from either sale?

Any input is greatly appreciated.

Regards,
Liz

[foolsgold99]

From what i recall, if you are resident for tax purposes in NZ, then you need to pay tax on your global income, but there are recipical tax arangements in place with most countries to aviod double taxs. If you pay tax in NZ, you'll not pay it in the US.

Have a look at the IRD web site, you'll get info there

http://www.ird.govt.nz/yoursituation-nonres/move-nz/

[Park City Partner]

Excellent questions! I have many of the same ones...including trying to find a tax advisor either in the US or NZ that has dealt with these issues. I have a business in the US that I will continue to receive income from along with other investments and don't plan to have NZ income, at least not initially, so not sure how to deal with it all. The link while somewhat helpful did not seem very detailed...anyone know a good international tax person?

[Carl and Liz]

Dear PCP:

I have been in contact with a guy who specializes in US/NZ tax issues who seems to know what he's talking about but we have yet to have an indepth discussion. Send me an e-mail at misswhizzy@hotmail.com and I'll give you an update once we have more info/experience with this guy.

I have had the worst time trying to find specific info. If you find any more resources, please let me know.

Liz

[toesonthenose]

I've looked into this before and you definitely want to be careful. As a US citizen you must continue to file 1040's and pay tax on any income above a $80,000 USD exemption. If your income is over this amount you will be taxed at applicable federal rates. Also this amount is prorated to the number of days in that country. I know a doctor who did a year in NZ and made about 110,000 and got hit with double tax on the last 30K. Let us know what you learn.