Annuity Beneficiary US citizen, Australian Resident

[playskoolpeople]

What is the name of your state? PA

I am a US citizen residing in Australia. I am the beneficiary of an annuity as a result of my grandmother's death. I want a lump-sum payment. Do I need to have tax withheld? Does this mean I need to file a tax return? I have never done so before. Thank you for your assistance!

 

[seniorjudge]

What is the name of your state? PA

I am a US citizen residing in Australia. I am the beneficiary of an annuity as a result of my grandmother's death. I want a lump-sum payment. Do I need to have tax withheld? Does this mean I need to file a tax return? I have never done so before. Thank you for your assistance!

Post this in the tax forum and tell them we sent you over there so that you do not get a nastygram for double posting.

I am NOT a tax attorney, but I suspect the answer is that you will have to file a Federal tax return and a PA return (if that commonwealth taxes income) since you earned income in those two jurisdictions. It doesn't matter where you are when you earn it; just that you earned it.

Anyway, I don't even do my own tax returns so post it over there to see what you find out.

 

[Dandy Don]

Do a GOOGLE search using the terms "Pennsylvania" and "tax accountant" or "CPA" and hire one to do your taxes and to ask questions of. It will be fairly easy to figure out.

You also need to find out whether you should have been filing tax returns a US citizen receiving foreign income. Has your citizenship officially been changed? How long have you been living in Australia? Do you expect to return to the US eventually or not?

DANDY DON IN OKLAHOMA ([email protected])

 

[playskoolpeople]

Has your citizenship officially been changed? How long have you been living in Australia? Do you expect to return to the US eventually or not?

Thank you for the response. I have never earned income in the US (having moved to Australia as an 11 year old), hence never submitted a tax return. All income earned has been Australian (am now an Australian citizen and have been a resident for 21 years). I do not intend to return to the US to live.

 

[seniorjudge]

Did you post this in the tax forum?

 

[FESTINA]

You stated that you have US citizenship as well as Australian.
You have a legal obligation to file a tax return (Federal) unless you gave up your US citizenship even if you do not owe any taxes. The first $90,000 USD (check with Embassy or Accountant on correct figure) is tax free as you are living abroad. If the US and Australia have a tax treaty, which they probably do, you get a tax credit on your US return for Australian taxes. By claiming that you do not intend to return to the US only means that Australia will deem you domiciled in their country for inheritance tax purposes. Income tax is not affected.
Others in your position, and there are many, have filed the last two or three years back returns. The IRS generally accepts that and lets the other years go (not guaranteed however) as long as there was no intent of fraud.
What you don't want is some IRS agent coming over from the US, giving you a call and asking that you come down to the American Embassy for a little chat over coffee.

 

[playskoolpeople]

Seniorjudge, I did post in the tax area. Thanks for the suggestion. I think I would have preferred to be left out of the will altogether! This is a pain.