ujong

Why would race make any difference? Are they Nazis? There are Thai citizens who are 0% Thai. What could matter is if the mother renounced her Thai citizenship before the birth of their child. Most countries require at least one parent to be a citizen in order to transmit citizenship to their children.

There was one time the IRS “corrected” my return and sent me a tax bill. I disputed this through written correspondence, siting various sections of the tax code. I was able to get away with it. But, had they dug deeper, they might have found a reason to reject it… but they didn’t. I consider myself lucky, not vindicated. Similarly in this case, I have to believe the IRS hasn’t looked into it deeply or doesn’t even know that Thailand is not imposing any tax. If they ever dig into this, what do you think is gonna happen? I have a pretty good idea.

The IRS has been known to reverse course once it realizes it’s own folly. This occurred in Singapore when their changed their mind about how employer contributions to the mandatory government social fund (CPF) should be taxed by the IRS. They issued a new ruling after issuing a past ruling. I’m not trying to pee in your punchbowl… I genuinely hope it works out for you — but I also think you need to be clear eyed about the risks, and that includes possible future action by the IRS that applies retroactively on your past filings. Hopefully the statute of limitations runs out before they get the chance… I believe 6 years needs to pass if the income in question is > 25% of your total income… then you’re home free.

If the tax maneuver is already getting nastygrams from from the IRS, it is unlikely that the IRS concurs with this interpretation, rather, they may have decided it isn’t a priority to pursue… yet. Until they actually issue a ruling, you are skating on thin ice. it sure smells like a BIG reach based on a technicality, and the intent of the savings clause sure seems to be a claw back. Rulings are typically issued based on “what is the intent” — and I can’t see how there would be any intent to let an RMD go tax free. I don’t mind being a little aggressive with my tax filing within reasonability, but this seems more far more bold than that. That is just my take.

A lot of people get away with a lot of things when it comes to the IRS, especially when it comes to the application of the US tax code overseas. This is because the IRS systems are mainly designed to sniff out bread and butter filing incongruities and the more common red flags areas. Everyone hopes they won’t get caught or hauled into court for a ruling if it’s a gray area. At the moment, give the current state of affairs in the IRS, it’s probably not a bad time in history to roll the dice… but that doesn’t mean they won’t catch up with you. You’ve got to ask yourself one question… do I feel lucky. Well… do ya punk? - Dirty Harry.