IMSpartacus

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About IMSpartacus

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  • Location USA
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  1. Living in Germany with US Retirement Accounts, 401K, IRA, Roth

    As the muddy waters start to clear, the joy rushes through my brain as I now try to recall the documentation I saved from former jobs' 401ks that we've rolled into our IRAs.     Thank you
  2. Living in Germany with US Retirement Accounts, 401K, IRA, Roth

    I'm much better with numbers than words so I must correct my correction of Takeaway 2 just to make sure I've reached full understanding ;-)   I take a distribution of $100 from either IRA.   Total contributions for this IRA is $1,000.  The value of my IRA at the time of the distribution is $10,000 which makes $1,000 contributions 10% of the value. Of my $100 distribution, $90 is taxed and $10(the aforementioned 10%) is recovered contribution which is tax-free. I take another distribution of $100 from the same IRA later that calendar year. Total contributions for this IRA is now $990($1,000-$10 from the previous recovered portion of my contribution).  The value of my IRA at the time of the 2nd distribution is $10,000 which makes $990 contributions 9.9% of the value. Of my $100 distribution, $90.10 is taxed and $9.90 is recovered contribution which is tax-free. Leaves me with a contribution total of $981.10 moving forward.    
  3. Living in Germany with US Retirement Accounts, 401K, IRA, Roth

    So is this post from you regarding the "3 tax phases/aspects of any pension plan" as close to a consensus without speaking to a tax expert:      https://www.toytowngermany.com/forum/topic/354821-living-in-germany-with-us-retirement-accounts-401k-ira-roth/?do=findComment&comment=3863879 Regarding the Accumulation phase: To correct my Takeaway 2: The sale of $1,100 worth of ABC is the result of a $100 contribution to the Roth.  Germany will consider the cost basis to be $100 and tax me for capital gains of $1,000.   Am I at least close to my Parkplatz?
  4. Living in Germany with US Retirement Accounts, 401K, IRA, Roth

    Thanks to all who have contributed good info on this topic.  No doubt the best takeaway from any of these posts are, seek professional tax help.  However, it's still interesting and nice to hear from others' experiences and understandings to help get at least some idea of what to expect.   I'm interested in confirming my understanding on what Germany uses for Cost basis on IRAs, Roth and Traditional.  A few variables defined for this and perhaps a follow-up I may have: We have not yet moved to Germany When we do, we will be done putting into IRAs/401ks of any kind. I want to only focus on German taxes as of today's laws so for arguments sake let's take the US taxation out of the equation, assuming my wife and I will never have more income than the tax credit we'll receive in the US.   Takeaway 1:  Considering my understanding that Roth and Traditional IRAs are not recognized in Germany, I have concluded that any transactions from either(regardless if it's a distribution or rebalancing) will be treated the same, as it pertains to tax laws in Germany, as a regular brokerage account. I sell $1,100 of ABC in my Roth that has a current cost basis of $1,000, I'll pay capital gains taxes on $100. I sell $1,100 of XYZ in my Traditional that has a current cost basis of $1,000, I'll pay capital gains taxes on $100. Takeaway 2:  Until we're officially tax citizens of Germany, every transaction that has happened before that won't matter except for determining cost basis.  So my understanding is that since Germany does not recognize US tax advantaged accounts, they don't care about original contributions and this won't be factored into Germany's calculation of taxes owed on sales in either IRA.  Using the above stock sale example: The sale of $1,100 worth of ABC with a current cost basis of $1,000 is actually from years of rebalancing a $100 contribution.  Germany only considers the current cost basis of $1,000 when calculating taxes owed. Am I in the Fußballstadion?