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tax reporting issue for US resident in Singapore

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martingale
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tax reporting issue for US resident in Singapore

Post by martingale » Thu, 10 Jan 2019 10:28 pm

i'm a US resident with Singapore citizenship.
I recently received a mail from DBS asking me to update my tax residence status at
go.dbs.com/sg-selfcert

i have some rental income on my property in Singapore. what do i need to do after i update my tax residence?
do i need to report rental income from Singapore when I file US tax return?
there's no treaty between SG & US, surprisingly! so means we have to be double taxed?

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sundaymorningstaple
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Re: tax reporting issue for US resident in Singapore

Post by sundaymorningstaple » Thu, 10 Jan 2019 11:39 pm

Surprise, surprise, surprise. Yeah you have to report your world wide earning to the US. It's not Singapore. The US is one of only two countries that tax your world wide income, the other is a little African country by the name of Eritrea. You will have to use Tax Credits. Welcome to the world of $2500 tax preparation charges.

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Re: tax reporting issue for US resident in Singapore

Post by martingale » Fri, 11 Jan 2019 12:26 am

sundaymorningstaple wrote:Surprise, surprise, surprise. Yeah you have to report your world wide earning to the US. It's not Singapore. The US is one of only two countries that tax your world wide income, the other is a little African country by the name of Eritrea. You will have to use Tax Credits. Welcome to the world of $2500 tax preparation charges.
so i need to pay the gap between US and SG income tax on the rental right?

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Re: tax reporting issue for US resident in Singapore

Post by sundaymorningstaple » Fri, 11 Jan 2019 9:17 am

It's not just that easy. You will probably need to use a tax accountant to explain it to you, but basically, yes, you are correct. The tax laws are different as to how rental income is handled You can start with this article and then do some research to learn more.
https://www.goldinglawyers.com/foreign- ... iew-guide/
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Re: tax reporting issue for US resident in Singapore

Post by Strong Eagle » Fri, 11 Jan 2019 10:12 am

By "US resident" I assume you mean that you hold a green card. Where are you physically residing, in the USA, or in Singapore?

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Re: tax reporting issue for US resident in Singapore

Post by martingale » Fri, 11 Jan 2019 10:41 am

Strong Eagle wrote:By "US resident" I assume you mean that you hold a green card. Where are you physically residing, in the USA, or in Singapore?
US

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Re: tax reporting issue for US resident in Singapore

Post by Strong Eagle » Fri, 11 Jan 2019 1:12 pm

I'm going to second SMS'es comment that you're going to want a qualified CPA for the complexities (I'm in Houston and have an excellent CPA, well qualified in foreign tax matters... she handled mine for many years).

In general, active earned income is taxed in the country in which you were living while you were earning the money. If you were living in Singapore, you'd pay income tax on earned income in Singapore. But, the USA doesn't care. They want to tax your earned (active) income as well, although they will grant a foreign earned income exclusion, which is around $105,000 for 2019. Since you're living in the USA, none of this is applicable to you, since your active income is generated in the USA.

In general, passive earned income (rents, dividends, etc) is taxed in the country in which the assets producing the passive income are located. Therefore, you will be taxed on your properties and income according to Singapore law and will pay Singapore tax.

But, the USA also wants to tax your passive income. You are allowed a tax credit for all foreign taxes paid. So, if Singapore taxed you $2,000, and the USA taxed you $8,000, you will _only_ have to pay $6,000 in US taxes.

This is the broad brush version. There are exclusions and limitations that make for very thick reading, hence the note that you probably want an accountant. I believe the business versions of turbotax and tax act handle foreign passive income but I never had that... only foreign earned active income, so you would need to verify.

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