The joys (and complexities) of being multinational
There are many of us who have moved overseas for a full-time venture and there are many more who travel overseas for extended periods of time. Unlike expats, multinationals are people who often have two places they call home, two languages and cultures to navigate, two groups of friends, and two financial realities. Living in more than one place is exhilarating and reminds us not to remain complacent. Having two lives, however, creates complexity and is more expensive than simply picking one place to call home.
U.S. citizens, wherever they may be, are always subject to U.S. taxation, forcing many to plan their finances like a multinational. Not only is a U.S. tax return required (usually) each year, multinationals must adopt a strategy around their finances that reduce tax complexity. This includes keeping most of your money U.S. dollars even though it's not often used. Keeping all investments in the U.S. and away from foreign investments eliminate PFIC and other tax triggers.
Those with two or more places they call home must consider how each country treats your worldwide income and which country is considered your "tax base”, often defined by where you reside 6 months or longer. Buying and selling property in any county could have tax consequences in both countries. It's prudent to map out your plans with a qualified tax advisor in both countries.
For those who are not a dual citizen, you'll have to apply for the appropriate visa. If you show proof of income, assets, and have no criminal past, its largely possible to be successful. After a number of years of residency and depending on the country, it may be possible to apply for permanent status. The U.S. has no formal position on dual citizenship.
The good news is that technology continues to improve, meeting the demands of the multinational. Sites like PayPal and Transferwise help with global payments between different currencies. They also come with debit cards that work almost anywhere. Transferring money overseas is cheaper and more efficient than ever.
At Eureka Wealth Management, I help map out the financial strategy for the multinational. l also manage investments that are U.S. compliant, strategize on insurances, and review the estate plan. Call for a free, initial consultation at +1(760) 537-0791 or online at eurekawealthmanagement.com/expats.