Using IRA Account for Retirement Visa

[seville]

Hi All,

Turning 50 next year. Can I use my IRA acount for the monetary requirement for applying for this type of visa?

U.S. Citizen

[Jingthing]

I assume you mean an O-A ("Longstay" visa) applied for in the U.S.

For annual retirement extensions in Thailand, absolutely not. (As for those, the funds need to be in a THAI bank account.)

For applying for an O-A, I would assume the answer is no.

That is because if using funds (to show at least 800K baht in dollars in the U.S.) for the O-A they are looking for something LIQUID.

As you are age 50, funds in your IRA are not really considered liquid until age 59 1/2 although you can access with a penalty.

For those over age 59 1/2 that's a more interesting question.

Showing an IRA balance would still not really be a BANK ACCOUNT statement.

The documentation clearly shows it is in a retirement account, not a BANK account.

For a definite answer you would need to ask the Thai authorities there unless someone here has specific experience. It is obviously an American specific question, being about IRA accounts.You might be wondering whether the staff processing O-A applications understand the difference between a bank account and an IRA statement. Well, it seems to me this question has come up before as IRAs are so common with Americans.

1. A copy of bank statement or evidence of adequate finance showing a deposit of the amount equal to and not less than 800,000 Baht or an income certificate (an original copy) with a monthly income of not less than 65,000 Baht, or a deposit account plus a monthly income totaling not less than 800,000 Baht
   In the case of submitting a bank statement, a letter of guarantee from the bank (an original copy) is required

1. http://www.thaiembdc.us/dcdp/Non_Immigrant_Long_Stay

Edited March 17, 2014 by Jingthing

[ubonjoe]

If you are asking about getting a OA visa at the embassy or one of the official consulates the answer would be yes, .But you would need to confirm what the requirements are where you apply.

For an extension of stay here it is no because you have to have the 800k baht in a Thai bank. If the IRA provides income of 65k baht or more you do an affidavit at the US embassy to prove your income.

[Jingthing]

ubonjoe, are you actually certain that an IRA statement from someone who can't even access those funds without major penalty would really be seen the same as a bank account for an O-A? Have you actually heard about that from specific cases?

If I was incorrect on my assumption that the staff would understand a not-liquid IRA investment account statement is not a bank statement, my apologies. Learn something everyday.

For someone under age 59 1/2, I think it's a stretch to claim "income" on an IRA investment account for similar reasons, those funds aren't supposed to be touched at all until age 59 1/2.

Edited March 17, 2014 by Jingthing

[ubonjoe]

I think a lot depends upon the type of IRA.

For funds this from embassy website. http://www.thaiembdc.us/dcdp/Non_Immigrant_Long_Stay

A copy of bank statement or evidence of adequate finance showing a deposit of the amount equal to and not less than 800,000 Baht

[Jingthing]

I think a lot depends upon the type of IRA.

For funds this from embassy website. http://www.thaiembdc.us/dcdp/Non_Immigrant_Long_Stay

A copy of bank statement or evidence of adequate finance showing a deposit of the amount equal to and not less than 800,000 Baht

With due respect, if you're under age 59 1/2, I don't think the type of IRA makes any difference at all (which are about taxation). Major penalties apply for any withdrawal. In that sense such accounts are not really fully liquid. The OP is not even near age 59 1/2.

While it MIGHT be possible for someone under age 59 1/2 to use an IRA account for this purpose, it somehow doesn't seem Kosher to me. A person really should have liquid funds to be able to stay in Thailand.

That said, I understand the question here is WILL they accept this, not SHOULD they accept this.

Without specific case reports, it sounds like bottom line is that the OP will either have to directly ask them or make an application using the IRA to see what happens!

To the OP, if we don't get any case reports here, if you do try this with your IRA (or ask them there), please let us know how it goes.

Edited March 17, 2014 by Jingthing

[ubonjoe]

I wrote in my first reply that they needed to check the what the requirements are where they are going to apply.

[Jingthing]

I wrote in my first reply that they needed to check the what the requirements are where they are going to apply.

Indeed you did.

I guess I still think this is more likely to be a problem, especially for someone his age.

The OP is looking for a definitive answer on the forum and he isn't getting one here.

That happens sometimes.

Cheers.

Edited March 17, 2014 by Jingthing

[ubonjoe]

It is nearly impossible to give a definitive answer for many things.

[Jingthing]

In any case, it turns out the OP has asked a really good question. I don't recall it ever being asked on the forum before and I even just did a search for that, and didn't find any previous cases. (Using IRA account for O-A visa application for age under 59 1/2 or even over that age.)

Here is a question I have which I don't know the answer to either:

Would it be smarter for the OP to just make his application using the IRA for funds qualification WITHOUT asking if it will be OK?

Obviously, that could be a waste of effort and expense if it is denied based on that.

But on the other hand, asking if something will be accepted raises a red flag and forces the issue and perhaps that would decrease the chances of approval?

Edited March 17, 2014 by Jingthing

[bunnydrops]

3 or 4 years ago an IRA CD account was excepted. Maybe they just looked at my bottom line but I was never questioned about it. Maybe the fact that it was an IRA slipped though.

[Jingthing]

3 or 4 years ago an IRA CD account was excepted. Maybe they just looked at my bottom line but I was never questioned about it. Maybe the fact that it was an IRA slipped though.

Were you over age 59 1/2 at that time or not?

Either way that's probably a clue the OP should just make the application without raising red flags.

Edited March 17, 2014 by Jingthing

[mahjongguy]

It is not true that one must be 59 1/2 to withdraw funds from a traditional IRA without penalty. You can Google "substantially equal periodic payments" to learn how that works. The amount withdrawn per year is limited but it might be a useful plan for someone who retires around age 55.

Moreover, all withdrawals made at any age are fully liable to be taxed as ordinary income. In effect, this means that the value of an IRA balance is actually worth 15% to 30% less than it appears.

Surely, none of this matters to the Thai consulate staff processing an O-A application. You submit the most recent statements of all your accounts, maybe toss in last year's income tax filing. If it looks "right" then they'll accept it.

However, after two years or less you will fall into the cycle of extending your Permission To Stay with local Thai Immigration offices. This is a different situation where a different set of rules applies. Your U.S. assets will not be considered. You will need to meet the requirement for income and/or Thai-based cash.

Edited March 17, 2014 by mahjongguy

[TerryLH]

I think people get caught up thinking what the embassy wants and what immigration require are the same thing.

The embassy just wants to see that you have that much money. They don't care where it's at.

They are not asking for it to be available immediately. They assume that immigration will sort that out later if they apply for an extension.

I agree, though, that you might not want to ask a question if you don't want to hear the answer.

[Jingthing]

It is not true that one must be 59 1/2 to withdraw funds from a traditional IRA without penalty. You can Google "substantially equal periodic payments" to learn how that works. The amount withdrawn per year is limited but it might be a useful plan for someone who retires around age 55. Moreover, all withdrawals made at any age are fully liable to be taxed as ordinary income. In effect, this means that the value of an IRA balance is actually worth 15% to 30% less than it appears. Surely, none of this matters to the Thai consulate staff processing an O-A application. You submit the most recent statements of all your accounts, maybe toss in last year's income tax filing. If it looks "right" then they'll accept it.

You're correct. That would be an exception that in my view is not really used by very many people.

[Jingthing]

The consensus seems to be to go for it. Sounds like a good chance it will work. However, the downside is that applications for O-A visas are kind of a hassle because you also need the police report and medical form.

[mahjongguy]

"That would be an exception that in my view is not really used by very many people. "

I did, and it worked well for me.

Because my taxable income was fairly low in those years, I used the SEPP scheme to make small withdrawals (about 4%) at age 57 and 58. My taxable income remained low enough that I topped out in a laughably low tax bracket. When I reached 59 1/2 I ramped up my IRA withdrawals, still paying fairly low tax rates. When I reached 62 and started taking Social Security I dialed back on the withdrawals in order to ease the tax bite on my SS income.

[Jingthing]

I considered it and didn't. Anyway getting off topic.

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[almasy1939]

I've heard that the proof of income method is easier, rather than showing a bank statement with an account balance. After all, that balance is going to get depleted and when you renew the next year, it might not meet the minimum requirement. I've also heard stories that once you start using the bank balance method, there are other rules that apply when you renew in subsequent years that make it a hassle, epsecially if you are relying on non-liquid assets.

The proof of income route, on the otherhand, only requires a letter notarized by your embassy. I'm from the US and I know that the ACS people at the bangkok embassy will notarize anything you put in front of them, they are only verifying the signature is valid, and not whether the contents of the letter are true. In fact, I have been told that many US retirees exaggerate their income to meet the requirement knowing the the embassy is going to notarize it anyway.

[Jingthing]

The OP could avoid O-A visa entirely and begin the process in Thailand but I would never suggest stating fictional income to the US embassy.

Sent from my Lenovo S820_ROW using Thaivisa Connect Thailand mobile app

Edited March 17, 2014 by Jingthing

[Mario2008]

From time to time immigration does ask for additional proof of your income. They are well aware that the US embassy (and a few others) only certify the signature and don't require proof.

[Suradit69]

I got a Non-imm O-A in Dubai and used my brokerage accounts in the US, including 2 x IRAs as proof of financial assets. Only had relatively small amounts in US & UAE current accounts (checking accounts) as well as some money in my Bangkok Bank account.

No questions asked about liquidity or accessibility. Got the O-A ... about 7 years ago.

Edited March 17, 2014 by Suradit69

[Jingthing]

I got a Non-imm O-A in Dubai and used my brokerage accounts in the US, including 2 x IRAs as proof of financial assets. Only had relatively small amounts in US & UAE current accounts (checking accounts) as well as some money in my Bangkok Bank account.

No questions asked about liquidity or accessibility. Got the O-A ... about 7 years ago.

Well, what would staff in Dubai know about IRA account liquidity?

Staff in the USA would likely know.

Also if the money outside your IRAs met the minimum anyway it wouldn't matter about IRAs being seen differently (if they are) and you didn't mention those details.

[JLCrab]

I've heard that the proof of income method is easier, rather than showing a bank statement with an account balance. After all, that balance is going to get depleted and when you renew the next year, it might not meet the minimum requirement. I've also heard stories that once you start using the bank balance method, there are other rules that apply when you renew in subsequent years that make it a hassle, epsecially if you are relying on non-liquid assets.

The proof of income route, on the otherhand, only requires a letter notarized by your embassy. I'm from the US and I know that the ACS people at the bangkok embassy will notarize anything you put in front of them, they are only verifying the signature is valid, and not whether the contents of the letter are true. In fact, I have been told that many US retirees exaggerate their income to meet the requirement knowing the the embassy is going to notarize it anyway.

Before signing your affidavit, the US Consular Official will ask you whether the information contained in your sworn statement is true. Making a false statement to a US Government Official is a felony. Regardless of the chances of any repercussions from that, it is your choice as to how you choose to live your life.

[1Ping1]

Great info above, and I sure as heck am no attorney.

I would add only that those funds "are" accessible to you, just as anyone's IRA is accessible to them. There are of course penalties for early withdrawal, and you then are going to have to pay taxes on the income "but" nowhere do I read that this makes them not assessable................................

Not sure you want to call this logic, but based on this logic, those funds should not raise anyone's radar. It is your money, and you do have assess to it if needed. No different than money in the bank........... You would simply pay the penalty, and pay your taxes on the income from the amount withdrawn early..

[Jingthing]

U.S. taxes are obviously not an issue with the Thai government. On the funds accessible, I get your literal point, but it's a bit of grey area as the entire IRA program was intentionally designed NOT to be touched until an older age. A pure test case would be an application at the Thai embassy in D.C. showing IRA funds only (preferably almost exactly 800K baht equivalent) from someone well under age 59 1/2. Anything less than a pure test like that might have other factors. For example someone showing 100 million dollars in an IRA, they're clearly just rich, so ... whatever ...

The other issue continuing with the LITERAL theme is that the rules from the website speak specifically of BANK accounts. An IRA account is most certainly NOT a bank account in the conventional sense, as in checking or saving, even though it may be hosted at a bank.

Edited March 18, 2014 by Jingthing

[seville]

Thanks everyone, well I have a roth IRA so I can access the funds with penalty if non-emergency. If emergency there is no penalty. Not likely to do it next year, just considering it.

I think it would be worth a try applying in America.

[Jingthing]

Thanks everyone, well I have a roth IRA so I can access the funds with penalty if non-emergency. If emergency there is no penalty. Not likely to do it next year, just considering it.

I think it would be worth a try applying in America.

Good luck with that.

If you do get your O-A visa (multiple entry) in the USA, note that it can be used to live in Thailand for almost two years (not only one year).

Each entry on the initial one year O-A visa validity gets you an additional one year. So if you exit and reenter Thailand just before the end of the initial one year visa validity, you get that "bonus" one year.

Check your passport for the expiration date of the visa to know what your deadline is.

After this initial O-A usage, if you still plan to live in Thailand, you then apply for retirement extensions at your local immigration office in Thailand. For that, if using the 800K money method, the funds must be in a Thai bank account (so obviously no IRAs for that).

In case you don't know, there is no lifetime retirement visa for Thailand. It's always one year at a time, with the exception of playing the initial O-A visa as I have described.

Edited March 18, 2014 by Jingthing