JimGant

19 hours ago, Liverpool Lou said:

You're assuming that the bank and the beneficiary could be the only parties to such action.  If a third party's claim was successful, both the bank and the party who received the assets irregularly could be penalised

You think a mia noi's claim might be successful? " He say he luv me mak mak and all his money will be mine."

2 hours ago, Mike Lister said:

Oh come on Jim......I can't go there, we're a commercial site and we have a responsibility to our sponsors. I have to recommend the legal approach

Ok. Just allow some counter arguments that the readers can chew on.

2 hours ago, Liverpool Lou said:

There sure could be penalties if it turns out that the assets were distributed incorrectly and illegally (which is called fraud)!

Well, Lou, I guess you won't rest easily unless your wife goes through probate. Also sounds like maybe there's someone out there that might contest the Will. Fortunately, I don't have that problem.

20 minutes ago, lopburi3 said:

Actually that will be the first step - police will return it to your Embassy from my understanding

Makes no sense. Yes, they need to make a copy of your passport, as they're required to report your death to your embassy. But your bank passbook? Would that be your joint account passbook also? Highly doubtful -- unless the lawyer mafia has done an end around...to make sure probates don't slip away.

On 1/20/2024 at 4:04 PM, Mike Lister said:

Don't mean to be a prude but if it's not legal, please leave it unsaid

Oh, come on Mike. If it's practical, like the person getting your bank funds is your sole beneficiary; you have no outstanding debts; and there's no one standing in the wings who could possibly complain -- why not cut the lawyers and their fees out of the loop. And recommended by your bank manager (in this case, mine)? Sounds like another thread of yours, where you say you're legally required to file a tax return if you have 120k in assessable income, even tho' you have no taxable income, and therefore are not subject to fines or penalties. I'll go with the practical, over the legal in both these situations -- particularly if there are no penalties involved.

25 minutes ago, retarius said:

I suppose what you are saying is that for 2024 tax filings, on the $30K I bring here in the example, I would owe taxes here of X, but be able to fully deduct those taxes paid off my US taxes (as long as the Thai tax rate doesn't exceed my marginal tax rate at home of 36%).

Am I correct in this thinking?

Essentially, yes. The formula for integrating foreign tax credits into your US tax return is interesting, if you like math riddles. Check out the instructions for Form 1116. But, if your Thai taxes on this IRA are less than the US taxes on same amount, your total tax bill between what you pay Thailand and what you pay the US will be the same as if you never filed with Thailand. And, as I think you alluded to, I have no problems paying Thailand and not the US my tax dollars/baht, as I'd rather pay to fix pot holes here than in Iowa. Timing is where it could be tricky, as you need to have your Thai tax return results (for credit purposes) prior to filing your US tax return. But an extension with the IRS is no big deal, as neither are amended returns. 

26 minutes ago, Jingthing said:

AGAIN  -- NOBODY actually knows how this is going to be enforced here.

Yeah, but nice to know what the treaties say is their right to enforce.

29 minutes ago, Jingthing said:

I thought the Thais had first crack at private pensions, not government pensions.

Taxable in the US withdrawals from US retirement accounts, usually traditional IRAs are arguably part of a U.S. government program. 

Are you absolutely sure such withdrawals would be subject to first crack by the Thais?

Isn't it WAY TOO EARLY to declare such definitive conclusions about such technical details?

I'm not declaring anything - I'm reading from the Technical Explanation of the Thai-US tax treaty:

Quote

Article 20

Paragraph 1 provides that private pensions and other similar remuneration paid in
consideration of past employment are generally taxable only in the residence State of the
recipient.   The phrase “pensions and other similar remuneration” is intended to encompass
payments made by private retirement plans and arrangements in consideration of past
employment. In the United States, the plans encompassed by Paragraph 1 include: qualified
plans under section 401(a), individual retirement plans (including individual retirement plans that
are part of a simplified employee pension plan that satisfies section 408(k), individual retirement
accounts and section 408(p) accounts)

I you want to see a test case on how a US expat's IRA is handled, read the following link. It is based on the US-Swiss DTA, which, like the Thai-US DTA, is based on the OECD and UN Model tax treaties. Thus, considerable similarity. Just substitute "Thailand" for "Switzerland" as you read. The main difference, of course, is that Switzerland taxes income, whether remitted or not. Same as most civilized countries.

https://hodgen.com/ira-distribution-to-u-s-citizen-living-in-switzerland-which-country-taxes-it/

29 minutes ago, retarius said:

I have the same question. I am at an age where I have to start drawing down my 410K account in the US. The sum I must withdraw each year is relatively large and it would be great if I could simply declare that none of these withdrawals are income by showing the statement from Dec 31st 2023.  

Sorry. All that money in your 401k or IRA is tax deferred income (unless you padded it with some after tax income, in which case Form 8606 would apply). Thus, when you take your annual Required Minimum Distribution or any other distributions, that now becomes taxable income in the year it is taken. So, nope, can't say it was income prior to Jan 1, 2024.

And, the DTA says Thailand has exclusive taxation rights on this income (if remitted). And the saving clause says you also have to declare this income on your US tax return. However, the Thai taxes would be a credit against US taxes owed.

The guy who agreed to this on the DTA was an idiot, as here you have years and years of tax deferred income, whereby the US collected no taxes. And now when paid out, and you're a resident of Thailand, Thailand gets  first collection rights on this money, and the US maybe no money, if the Thai credits cover the US tax. Wonderful planning, US.

6 minutes ago, Mike Lister said:

my guess is that was one of the most common statements made on these sites, by expats.

Indeed. Dandruffman123 must be joshing.

9 hours ago, JimHuaHin said:

But, if the funds used to pay the credit card debt were acquired after 1 January 2024, then the purchase is classed as a taxable remittance.

We're forgetting that the new rule applies to remitted INCOME, not remitted cash flow. A credit card cash flow to the Thai merchant I buy from is just a loan from the bank that issued me the credit card. It's not remitted income. This is in the same category as, I borrow $100,000 from my mother, which I then remit to Thailand. Whether I gave my mom a note, or she considered it a gift, is neither here nor there. It is definitely NOT income, and therefore would not show up on my US tax return, nor would it be considered income for Thai purposes. How I pay the bank back, or how I pay Mom back, does not redefine this loan as income.

Do you really think the Thais are going to view all remittances into Thailand as income? Of course not. And they're not going to be able to differentiate remittances between income and capital. As said too many times on these threads, common sense dictates that what you report as assessable income on your Thai tax return will be determined only by you. Random compliance audits, like we do in the US, may be in the future. But even if hit by one of them, if you filter all your monies through an offshore or home country bank, the fungibility of such money, and some good record keeping, should shoo away the revenuers.

On 1/22/2024 at 10:32 AM, Mike Lister said:

So, people who earned money last year and remitted it last year, are taxable on that income. It's a basic premise of all of these discussions on tax, in every thread.

Indeed (unless the applicable DTA says the home country has exclusive taxation rights on that income).

3 hours ago, Mike Lister said:

   the groups are, remitted, excluded assessable and taxable

Taxable, of course, is the remaining assessable income after subtractions of allowances, deductions, and the 150k freebie. Similar to the US definition of taxable income (TI), which is adjusted gross income (assessable income), less the standard deduction. No TI, no tax filing required.

But what is your "excluded assessable" category?

25 minutes ago, Mike Lister said:

There are 88 other DTA's apart from the US and UK DTA's, not all posters are from just those two countries.

Well, granted. But the preponderance of readers here have the King's English as their primary language, with, of course, the exception of we Americans, whose language is anyone's guess.

5 hours ago, OJAS said:

Yes, we could well, I think, be the low-hanging fruit here in the RD's eyes. And, given the dual pricing tradition in LOS, could we seriously discount the possibility of being clobbered for tax at "special" foreigner rates which were, say, double the corresponding ones paid by locals? 

Well, the DTAs have a separate Article dealing with "Non-Discrimination" -- here from the US DTA:

Quote

This Article assures that nationals of a Contracting State, in the case of paragraph 1, and residents of a Contracting State, in the case of paragraphs 2 through 4, will not be subject, directly or indirectly, to discriminatory taxation in the other Contracting State. For this purpose, nondiscrimination means providing national treatment.  

Paragraph 1 provides that a national of one Contracting State may not be subject to
taxation or connected requirements in the other Contracting State that are other or more
burdensome than the taxes and connected requirements imposed upon a national of that other
State in the same circumstances.

Could be interesting if push came to shove on such matters. The US State Dept takes treaty matters very seriously, so I would hope our Embassy (and others) would take any treaty violation seriously. But, I guess it would all depend on the golfing weather at the time.....

1 hour ago, Mike Lister said:

A resident of Thailand who in the previous tax year derived assessable income under Section 40 from an employment or from business carried on abroad or from a property situated abroad shall, upon bringing such assessable income into Thailand, pay tax in accordance with the provisions of this Part.

Come on, Mike. This rental question has already been explored vis a vis the US and the UK DTAs. Thailand is secondary tax collector, meaning you pay taxes primarily to your country where rental property exists, and those taxes are used as credits against any Thai tax assessed. Please don't scimp on the full picture of how expat landlords will be treated here in Thailand.

16 hours ago, Mike Lister said:

Whilst it says that "income from property may be taxed in the country the property is located", it doesn't use the same verbiage as other DTA's I've seen where exclusivity is intended. In those other cases, the word "only" is prominent.

The US-Thai DTA uses the same language, i.e., "may be taxed" without the "ONLY" qualifier. And, the US DTA has a technical explanation that probably would apply to the UK-Thai DTA:

Quote

.... may be taxed in the Contracting State in which the property is situated....

This Article does not grant an exclusive taxing right to the situs State; the situs State is merely given the primary right to tax.

And, the primary taxing country gets to keep all the taxes collected, while the secondary taxing country (in this case, Thailand) has to give a credit for those taxes paid in the situs country.

From a practical standpoint, I'd do a back of the matchbook evaluation of what, if any, taxes I'd owe Thailand, after factoring in the credit. And if none, I wouldn't even bother to include this rental income on any Thai tax return I filed, particularly since they haven't gotten around to providing a place on their tax returns to show credits. No evasion here, of course -- just a practical solution.

5 hours ago, SHA 2 BKK said:

Wilson looked at this diminutive, half deaf PM from a nation of 4 million people,  that had only been had its own Government for 18 years and said to Hughes “I sir represent 60 million Americans”.

Yeah, Yanks can be bloody arrogant. I apologize. Aussies have been our finest allies, sticking with us through our worst follies, like Vietnam.

OK, enough thread creep. Sorry.