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Thread: US tax implications for KiwiSaver

  1. #1
    Join Date
    Feb 2017
    Location
    New Zealand
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    5

    Default US tax implications for KiwiSaver

    Hi there -

    I have been trying without a lot of success to find out if I need to file IRS form 3520 for my KiwiSaver account. I am a US/NZ dual citizen resident in NZ. I am finding tax preparation extremely time consuming and expensive. The price I have been quoted for my expat tax specialist to fill out these forms is $485 USD/ each. I'm pretty sure that is more than the interest I have made on the funds. Sigh

  2. #2
    Join Date
    Aug 2005
    Location
    West Auckland
    Posts
    1,029

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    I consulted a US/NZ tax specialist to make sure I was compliant, and I've never filed (or even heard of ) that form.
    These are the forms I filed last year:
    FBAR (I declared kiwisaver here)
    1040 and schedule B
    8938
    2555EZ
    request for filing date extension (automatic 2 month extension but you have to ask for it)

    hope that helps, yes it's a pain but now that I've been doing it a few years it's pretty straightforward.

  3. #3
    Join Date
    Feb 2017
    Location
    New Zealand
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    I'm glad to hear that your specialist didn't tell you those forms were necessary. I really feel like it is not worth filing them, but I am having a hard time convincing the tax prep lady. I usually have done all the filing on my own, but it is so complicated that I am never really sure if I have got it right. And I am loathe to pay even more in "prep" than in "tax" as at least some of the tax gets written off against what we pay in NZ tax. (Though not the self-employment tax apparently, but that is a can of worms for another thread).

    Also, I am not sure why random letters got capitalized in my previous post. I'm new here, not sure if there is a way to edit.

  4. #4
    Join Date
    Feb 2008
    Posts
    36,064

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    Capital letters removed!

    The 'edit' function is only operational for forum members for a few minutes after you post - just long enough to correct a duplicated word or typo that you spot just as it goes live. After that, it switches off, so nobody can alter one of their own posts after there have been replies, and make a nonsense of the later part of a thread.

  5. #5
    Join Date
    Aug 2005
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    West Auckland
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    Quote Originally Posted by Spoons View Post
    but I am having a hard time convincing the tax prep lady.
    why does she think 3520 is necessary?

  6. #6
    Join Date
    Feb 2017
    Location
    New Zealand
    Posts
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    She thinks it counts as a foreign trust with a US owner. And she wants to know lots of information about it which I am having a hard time getting - and, honestly, don't really want to spend my time finding. Such as exactly what companies it is invested in and how much, or what percentage of each company/stock, and of course all reported on 31 Dec. for each year, when most NZ accounts have a financial year ending 31 March. If there is any way that I don't have to fill this stuff out, I would be exceedingly grateful!

  7. #7
    Join Date
    Feb 2017
    Location
    New Zealand
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    Thank you!

  8. #8
    Join Date
    Aug 2005
    Location
    West Auckland
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    I'm just muddling along figuring it out from the IRS website each year (and help from that consultant one time) so I'm no expert and could well be wrong, but....my understanding is that Kiwisaver is a retirement savings account, not a trust. So 3520 doesn't apply. If you decide the form isn't necessary, then don't file it. It sounds like the tax preparer is causing you more stress that doing it yourself

  9. #9
    Join Date
    Feb 2017
    Location
    New Zealand
    Posts
    5

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    The tax preparer is causing me more stress than doing it myself at this stage. However, I have already engaged her services, so I can't really back out now. We have been working on this since July! Also, because we have a small business, my husband does a bit of work in the US, and I am a couple of years behind (yikes), doing it myself was pretty stressful too. I'm glad to have found this site, and a few people who are also filing. Only one of the other US expats I know here bother to file. I'm sure the reason they don't file is because it is so complicated, since most of them probably wouldn't owe any actual tax.

  10. #10
    Join Date
    Jan 2017
    Location
    Singapore
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    Quote Originally Posted by Spoons View Post
    The tax preparer is causing me more stress than doing it myself at this stage. However, I have already engaged her services, so I can't really back out now. We have been working on this since July! Also, because we have a small business, my husband does a bit of work in the US, and I am a couple of years behind (yikes), doing it myself was pretty stressful too. I'm glad to have found this site, and a few people who are also filing. Only one of the other US expats I know here bother to file. I'm sure the reason they don't file is because it is so complicated, since most of them probably wouldn't owe any actual tax.
    ------------------
    Last edited by filipinoguy; 20th February 2017 at 02:22 PM.

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