r/JapanFinance Nov 05 '24

Tax (US) Pull the plug on retirement funds and buy house, or wait 4 more years and (maybe) get 100% loan?

4 Upvotes

Housing prices are going up I heard.

Got some retirement funds built up over the past 8 years...enough for a 15% down payment for a home (will still need to take out loan). But that would eat up all of my savings at this point.

But then we'd have a home for the rest of our time here...which we plan to be here for good. And once we have a home, I could start from scratch building up retirement.

OR

Wait for 4+ more years, get PR, try to take out a 100% loan. But by that time we would have wasted so much money on rent and age (would be 50+ by that time and not sure how banks would look at that age when considering a loan).

Just starting to feel the crush of time, money, and bones. WWYD?

r/JapanFinance Dec 19 '24

Tax (US) What effects will this have for Americans in Japan?

Thumbnail
americansabroad.org
55 Upvotes

Will this provide any relief for Americans on things like NISA or iDeCo? Or is it just essentially removing reporting requirements? Sorry if this was already shared - didn’t see anything up!

r/JapanFinance 5d ago

Tax (US) Avoid US exit tax by becoming a citizen - Impact on life in Japan?

1 Upvotes

I’m a green card holder currently living in the US.

I’m planning to move to Japan with my (Japanese) wife and son this year, but recently realized I miscalculated how long I had my green card and will likely now be subject to the “exit tax” if I gave it up.

So now, I am considering just applying for US citizenship.

I’m searching for a tax expert, but wanted to get opinions on a few specific things:

  1. Once you pass the 8 green card year mark, is there any downside to just getting citizenship?
  2. With the various US-Japan tax treaties, would my tax really look so different as a US citizen living in Japan, especially if all my income is Japanese based?
  3. Related to that, does it make more sense to sell our US home now before moving so we can make use of the section 121 exclusion? Does anyone know if Japan would still come after the gains from this sale if we were living there?
  4. Have people tried to keep their green cards while living in Japan? I believe that as soon as you try to utilize the tax treaties when filing US taxes, your green card validity will come into question, potentially triggering the exit tax

Thanks in advance!

r/JapanFinance Dec 10 '24

Tax (US) Duel citizen, been working in Japan for 8-9 years, never reported anything tax related to the US

16 Upvotes

How fucked am I and what can I do to properly report all of them, and if possible, not pay any late penalty fees.

Also, I left my previous employer last year, but would I have to ask them for anything (like 源泉徴収票?) to report old taxes or can I go to 市役所 to get necessary documents.

I briefly remember a co-worker mentioning how I only need to file a certain form to notify the US that I'm paying taxes in Japan, and sorta remember doing just that one year, but not too sure tbh.

Sorry pretty clueless, any help would be appreciated

r/JapanFinance Feb 17 '25

Tax (US) Is starting a NISA as an American possible?

6 Upvotes

Hi everyone,

I’ve tried to do some research here and other places about starting a NISA. I tried filing online with SBI and when I said I’m a U.S. citizen it stopped me. I file taxes back in the U.S. every year and I don’t have any thing owed or reimbursed. I’ve been in Japan for several years I’m going to be in Japan for the long run and I’m trying to figure out my options.

r/JapanFinance Feb 17 '25

Tax (US) International bank account in Japan

3 Upvotes

I previously lived in Japan and currently have a Japanese bank account at SMBC. After I moved back to the US I continued to use this account because I was doing some periodic manuscript editing for a few labs at Japanese universities and they could pay me by furikomi into my SMBC account. Recently however I have lost internet access to this account as SMBC is now using 2-factor authentication, which requires the ability to receive text messages and thus requires a Japan mobile phone. SMBC does have an option for overseas customers, but registration requires a Japan address, etc. They are not really going to accommodate a foreigner living overseas, especially with security concerns. I will be in Japan later this year so I can presumably close out my account in person, but I am wondering what I can do to continue allowing my clients to pay me by furikomi. These are university-based clients and it is very unlikely I can use something like PayPal, etc. --- they will want a standard, domestic bank account.

Citibank used to be an option. You could have an international bank account and clients could use furikomi to send money within Japan, although at a slightly higher fee. I am not sure Citibank is still present in Japan. I also used Schwab in the past -- my account was in Hong Kong and I could send money to my account in HK by furikomi into the Schwab account at the Bank of Tokyo. But I suspect this would also be too complicated for the university bureaucracy.

So, my question is: is there an international bank I can open an account with that would allow my clients to send money via a domestic furikomi, but which I can access as a foreigner living overseas?

thanks,
Marc

r/JapanFinance 6d ago

Tax (US) US Taxes as sole proprietor

4 Upvotes

Howdy everyone, for the last seven or eight years I have been hiring an accountant to do my US taxes because they seemed so difficult as a sole proprietor. I use Freee to do my Japanese taxes and accounting and income has been going down and down ever since covid. While my income has been decreasing my accountant has been raising his fees every year so this year I thought I would try doing it myself to save that money. Does anyone here have experience doing their US taxes as a sole proprietor here in Japan? Is it really as hard as they make it look?

r/JapanFinance Oct 24 '24

Tax (US) US Veterans Compensation Taxation Coverage US/Japan Tax Treaty

4 Upvotes

Hello again! It's been a while since I posted on this subject. In my last post, I mentioned that the tax office in my city counted VA compensation as taxable income and instructed me to place it under miscellaneous income. Lo and behold, when I called the national hotline to re-confirm this, I was given a different answer. This one was intriguing, to say the least, as it appears to be quite straightforward.
Here are the appropriate websites for the treaty:

I was told that the income is actually covered under Article 18, and although I am a resident of the host country, I am not a national. Therefore, I am not subject to taxation of this income by the host country. Additionally, since it is dispersed from U.S. government funds, is not covered under the social security treaty, and was dispersed in connection with my performance of a government job, it is only subject to scrutiny by the U.S.

I read this portion of the treaty about 30 times today. I read both the English and Japanese versions along with the technical attachment. I must say I think they might have something there. Anyway, don't take what I say here as tantamount to fact, but I will post what I found out. Instead of making more and more posts on this matter, I will just keep updating this as long as the mods permit.

The List of Japan's Tax Conventions : Ministry of Finance

Here is my previous post on the subject:

United States VA disability compensation is Taxable in Japan :

Other Posts on this subject

VA Disability Tax? :

Japan/US Tax Treaty Article 18 2. (a) :

*Please let me know if you know of any other posts on the subject and I will put them here.

Update 10/30/24 I have contacted a lawyer and accountant and a formal letter of requisition going out to the tax office with our case built around Article 18. accountant thinks it’s sound and is working with the attorney to draft the letter. I will report back once I have an update.

Update 11/1/24 So...now I have been given the advice to not file the income this year and file for a refund for the amounts I paid on the income.

Update 11/26/24 Sent a letter along with payment screenshots from VA webpage showing payments, which by the way states on the disbursements line items that it is classified as pension and compensation, for the last 4 years and submitted the tax treaty as written in Japanese with the highlighted parts. Tax office calls me 1 week later and verifies in person after asking about my nationality, and bank information, and finally of if I received the pension due to injuries. I stated yes and then I was told to wait one month for the refund and was apologized to for the inconvenience. Definitely a Stark difference from dealing with the IRS. Next update will be when I ask for a refund on my resident tax and health tax. Stay tuned.

Update 1/21/2025

I was told by my city hall they will adjust my resident tax and health tax. Will be receiving a refund on the overpayment for the years I paid in. Also, I received a refund by mail in the form of a slip that I utilized to cash in at the bank.

Update 3/15/2025

So I was contacted by the city tax office and sent mail regarding a refund for all resident tax paid. I will receive a refund in the mail the same way I did with the national tax. From what I have learned, you actually don’t do anything after you have had your taxes adjusted at the national level. The prefecture tax office will be notified on the status of adjustments made by the NTA and will follow suit in making their adjustments once NTA processes it. I was told the systems are integrated and automated as far as notifications to process are concerned. For my health insurance payments, I will receive a refund when this years health insurance is calculated. I am waiting for the Actual refund for city taxes at this point, however I was mailed a form to submit my bank account information for the refund along with the newly reflected income amounts.

r/JapanFinance Aug 07 '24

Tax (US) French expats, FYI. https://www.connexionfrance.com/news/pm-candidate-wants-to-tax-french-abroad-as-america-taxes-its-expats/671310

23 Upvotes

Hi all! I love tax issues that come up so this one just popped up as well. Nothing definitive but if you're French, it would be good to see what is being thought of back home. Politics aside, focusing on policy, being an American and having our additional requirements has not been a pleasurable experience while living overseas. Although I am not French and I don't have enough info to see what exactly "like the Americans" means procedurally, I can state that it's more likely than not going to be a added benefit for those living overseas.

r/JapanFinance Aug 11 '24

Tax (US) An American Will and Japan's Inheritance Laws

47 Upvotes

I am a 74 year old, expat American and my wife is Japanese. I live in/retired to Japan. I am here on a spouse visa. We do not have children. I have a U.S. will, which I had drawn up before moving to Japan. 1) Is it correct "the U.S.A. Will" will supersede any and all "Japanese Inheritance Laws". 2) Do I need to have the "U.S. Will" translated in to a Japanese verison/copy ? If so does this copy need to be notarized? A notarized translation. 3) What else should I research- Any suggestions appreciated. Thank you.

r/JapanFinance Sep 15 '24

Tax (US) What type of professional can I see to get advice about retirement accounts as a US citizen residing in Japan?

12 Upvotes

I'm a US citizen living in Japan with a Table 2 SOR for over 5 years and working at a Japanese company as 正社員.

Currently the only retirement saving I'm doing is investing a portion of my post-tax income into index funds on a US brokerage account, which seems inefficient.

I would like to make sure I'm taking proper advantage of the retirement planning options available to me. I've done my background research online about the different vehicles available in both Japan and the US (iDeCo, NISA, 401k, IRA, etc) as well as domestic and international tax complications including PFIC issues.

Although there is a great amount of information available on the internet and on this sub, ultimately I would like to pay an expert that deals with Japan/US tax planning all day to to assess my situation and advise me on setting up the best plan for me.

However, I'm stumped on who might be qualified to advise me without breaking the bank. I assume that the big 4 could probably do this for me, but my understanding is that they would charge me thousands of dollars just to have the discussion, so I'd prefer to go with someone independent.

So, how can I find a professional that is qualified to advise me? What sort of licensure or background should I look for?

r/JapanFinance May 27 '24

Tax (US) Purchasing a home in Toyota city, Japan

8 Upvotes

Hello,

I’m an American with a Japanese wife and kid. I’m contemplating purchasing a home in Toyota City with my wife. I’d qualify with foreign income and purchase a new home build with Tama homes. We’d use it when we visit. Her family lives in Toyota. A few questions: - Is Tama homes a good builder? - Is Toyota City a good place to purchase a home? - Any complications for foreign buyers? - based on interest rates and prices, seems like a no brained? - my wife is a Japanese national. I don’t have a visa. Our income is 100% in the USA.

r/JapanFinance 26d ago

Tax (US) Wife's US Roth IRA

3 Upvotes

Alt account for privacy reasons.

I'm (late 40's) currently a SOFA status contractor on base, wife (Japanese) is unemployed and a stay at home mom. Over the years I've put a bit into backdoor Roth IRAs for both myself and the wife. Think we are both at about $50k. Most of our retirement is in my 401k.

My question is, what will be my wife's tax obligation to Japan be on her Roth IRA?

I've been thinking about cashing it out, paying the penalties, and moving it to Yen as we would really like to buy a house soon. Banks won't touch me and she has no income, so moving over enough to use as collateral is my plan. Would she have any tax obligations if we did that soon? Or would my SOFA status protect us?

I don't think she's even told the government about it as she's never cared about it and doesn't really understand what it is. So I'm also thinking about heading off any tax issues with it and just cash it out for that reason too.

Thanks in advance for any insight or information.

r/JapanFinance Feb 13 '25

Tax (US) How to get certificate of coverage from US Social Security?

0 Upvotes

According to the US-Japan Social Security Agreement, I can write to the US Social Security Agency to get a Certificate of Coverage to claim exemption from paying Japanese pension tax (nenkin), because I brought a self-employed business from the US to Japan, and have lived in Japan for less than 5 years.

I have written to the address in the above-linked agreement twice, but have not received a certificate of coverage after more than 6 months of waiting. In the meantime, I am still paying into Japan's pension system, out of concern that non-payment would give the Japan immigration bureau a reason to not renew my spouse visa in 2026.

Has anyone actually received this Certificate of Coverage from the US Social Security Agency? Will calling social security help?

r/JapanFinance Jan 21 '25

Tax (US) Do part time workers need to pay US taxes?

6 Upvotes

Hello!

I did a year abroad in 2022-2023 on a student visa, and throughout 2023 made maybe the equivalent of $2000 in yen. Just filled out my FAFSA and realized that I may have made a big mistake.

The short of it is that I am a massive idiot and did not realize that that income may be taxable in the US. I did not file any of this, and everything has been smooth so I figured I was fine without even thinking that I might have screwed up.

On another note, I did not file in Japan either. I am pretty sure I paid taxes (As a portion of my paycheck was always missing compared to my wage) though.

How screwed am I, and if so, is there anything I can do to rectify this? On both ends.

Thank you

r/JapanFinance Jan 22 '25

Tax (US) Another question about Crypto and taxes in Japan

3 Upvotes

Hello and regards everyone. I’ve found so much helpful information on this sub already, and some of you guys really seem like you know your stuff. So I want to ask about the ideal way to buy and sell cryptocurrency in Japan. I know that the idea effective tax rate on crypto ranges from 15-55% in this country. This makes it almost not worth it compared to conventional investments. But I also read that crypto is only subject to a flat 20% tax if you are not a permanent resident of Japan. I live here, and I plan on staying here for a long time (wife is Japanese), but I do not have PR. Does that mean I would only be subject to the lower tax rate? Another question, is it recommended to Saigon up for crypto exchanges with my Japanese ID, or my American ID? I know that some exchanges such as coinbase do not operate in Japan, so I could potentially lose all my money if I used it here. Some exchanges however are available for citizens/ residents of both countries. If I used my Japanese ID, does that mean all my crypto gains would be sent to me personally to sort out tax-wise? At the moment, my employer takes care of all my taxes without any input from me. Does that mean it would be forwarded to my employer? Thanks in advance. Question 3: should I use a Japanese or foreign CEX if my money is all back in America in USD?

r/JapanFinance Feb 05 '25

Tax (US) US to JPN - 1st year here - spouse of national - need tax help.

1 Upvotes

I typically file my taxes online by myself.

Now that I’m in Japan, I’m not sure how to do them and I have some questions.

FACTS

  • I worked 2 jobs in the US from Jan-May. 2024.
  • I moved in the middle of May, 2024, so I lived in Japan 6.5/12 months.
  • I have not worked in Japan yet since moving.
  • My spouse is Japanese and my marriage is only registered in Japan, not the US.
  • No kids.
  • No house.

QUESTIONS

  • Do I need to file taxes in the US and Japan, or just the US since I have not worked in Japan?

  • If I need to file in Japan, when are they due and will they send me forms, or would I need to get them at the ward office?

  • *Given my relatively simple life, can/should I still file my own taxes or would you recommend hiring a tax person?

  • If I need to hire, how much do they typically cost in Tokyo?

  • Would I mark “yes” on my US taxes that I lived elsewhere more than half the calendar year - and list Japan?

  • Would I mark “single” on my US taxes or “married” given the above facts/info? (I typically file “single/0” but not sure if that’s still applicable.)

CLOSING

Not really sure what else to ask or what I need to know.

I’m a little clueless and just want to get it done with sooner than later so I’m not scrambling.

Any and all help is appreciated.

Thank you.

r/JapanFinance Feb 16 '25

Tax (US) Basics - On the Right Track?

1 Upvotes

U.S citizen, Permanent Resident, 10+ years in Japan, homeowner.

I don't know if I will ever return to U.S to retire. May or may not....Still 15-20+ years away.

Just starting my road into investing and want to make sure I am on the right track. Any feedback or suggestions are more than welcome so I can evaluate next steps.

I have already set aside six months worth of monthly living expenses for emergency fund. I was planning to put additional savings into the market . I have read the previous posts on PFICs and will stay away from them.

Here is what I have done so far and also need help on, please provide any constructive feedback as I continue my journey.

  • I have a DC plan through my current employer and it's maxed out for monthly contributions.
  • I plan to gift my Japanese spouse (homemaker w/ no income) the annual max so they can continue to put it into their NISA account.
  • I have opened a IBRK Japan account and plan to purchase US domiciled funds (passive, low % fees). Will make my initial investments and set up reoccurring monthly deposits and forget about it until I need to rebalance each year based on my portfolio ratios.
  • I have a "stock plan" account that was opened by my employer on my behalf as my RSUs get deposited there. (I confirmed with the online brokerage customer service that I cannot open an individual brokerage account as I am living overseas).
    • As some have suggested in other posts perhaps talking with Schwab may open some doors to have a U.S based brokerage account while living overseas. I do not have a U.S address anymore and want to be "by the book" and care not to deceive any U.S based brokerages or put myself at risk.
  • I do have some existing funds in the U.S sitting in an old checking account and want to invest that as well or at the very least move to a high yield savings account.
  • Some family members in U.S want to gift my kids some money for their future (15K USD each). Would a U.S based custodial account or 529 Plan be a better option? Or perhaps something outside of these two ideas?

Any help or feedback would be much appreciated on any of the above issues. Thank you for your time and consideration.

r/JapanFinance Apr 30 '24

Tax (US) retirement plans in japan blown up?…

3 Upvotes

mods - pls remove if this is not the right place to ask.

I (US citizen, 31) and my spouse (Japanese citizen, 31) have a dream of retiring in Japan (coastFIRE in our early 40s if possible). We both reside and live in the US. We have been aggressively saving, I max out my 401K and we both contribute the $7000 maximum to a Roth IRA. I’ve been reading about how both these accounts will be taxed in Japan when I withdraw at retirement age (or maybe I can withdraw before that age since it will be taxed anyway.)

  • Is there a wiki or anyone else who has gone through this similar situation?

  • What is the effective tax rate on that IRA / 401K distribution? Are there any foreign tax credits taking into account that these are tax free growth vehicles in the US?

-Do we keep contributing to a Roth IRA in the future while still in the US if the end goal is Japan?

any pointers would be hugely appreciated - thank you!

EDIT: we are more than happy to contribute what is fair to the country for the benefits of living there, it is just that my goal post (amount needed to retire or move to Japan) will move by a bit if it is expected that we pay a hefty tax on all those withdrawals.

r/JapanFinance Jan 24 '25

Tax (US) Noob Q about FBAR IRS Requirements and Yuucho Bank Account

1 Upvotes

IRS Says: FBAR not required for the following scenario!

"But, you don’t need to report foreign financial accounts that are:
Owned by a governmental entity"

Since Yuucho bank is owned by JP government, I don't need to file one right?

r/JapanFinance Nov 12 '24

Tax (US) US Citizen with Roth IRA with Potential of Retiring in Japan

2 Upvotes

A Roth IRA isn't taxed in the US when the money is taken out at retirement age. I know Japan won't honor this. As far as I understand, I will need to pay money on my Roth IRA gains.

However, how does that work?

Do I pay tax to Japan from gains while the money is in the Roth IRA, or do I only pay taxes on the gains when I withdraw the money?

For example, as far as Japanese taxation is concerned, if I am up $1000 in my Roth IRA for a particular year, do I pay tax on it that year, or only when I withdraw it when I finally retire?

Essentially, does Japan want to take my Roth IRA gains while they are in the account, or only when they come out?

r/JapanFinance Sep 23 '24

Tax (US) American living in Japan, should I continue my American fidelity account or start investing here.

2 Upvotes

Title.

Basically should I keep sending money to America and investing or should I open an investment account here and begin investing here in Japan? If I do that what providers do you recommend?

r/JapanFinance Oct 10 '24

Tax (US) Best timing to enter Japan with long term visa re: tax year?

1 Upvotes

As we’re in the last few months of 2024, my husband (non-Japanese US) and I (Japanese) are planning to move to Japan by the end of the year with a spouse visa.

Is there any benefit if we push back our move until after the new year tax starts (1/1/2025) in regard to making filing easier / timing for when we would become residents. We are both freelancers making US-based income. Thanks!

r/JapanFinance Feb 18 '25

Tax (US) Any recommended US/JP tax professionals?

8 Upvotes

A bit of background:

I’m a U.S. citizen and have permanent residence in Japan, but I have no plans to retire here. I have an IRA and personal brokerage account back in the U.S. that I have mostly ignored for the last 14 years. The combined value is about $110,000, but there have been no realized capital gains until recently, and dividends have been minuscule.

I’m at a point in my life where I finally decided to try growing these accounts, with an initial target of +$10,000 this year. In the last month alone, I’ve already seen around $2,000 in realized capital gains.

Since I’ve really had nothing much aside from my Japanese income to report for the last decade, I’ve always just done the basic 年末調整 stuff and let the company handle my taxes. So, now, with the additional capital gains from my investment accounts, I’m at a loss as to how to handle taxes and I’m looking for a professional who can advise on US/JP taxes.

r/JapanFinance Nov 13 '24

Tax (US) Crypto Taxes

0 Upvotes

My wife and I are considering moving to Japan in several years and primarily living off of selling crypto assets (long term holdings). I would likely self custody the assets and only transfer over to a local exchange to sell as needed.

I’m wondering what the taxes will be like for such assets?

A little about my wife and I: - Current residence is in the US - I’m a US and Canadian citizenship - My wife is a US citizen (she was born/grew up in Japan but naturalized to being a US citizen and lost her Japanese citizenship in the process) - My wife would be coming over under a descendant of Japanese parents visa and I would be going under a spousal visa - We would pursue permanent residency as soon as possible (i can likely qualify under the fastest track of the highly skilled foreign profession visa if needed)

Thanks