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Date: Thu, 15 Apr 2004 16:02:54 -0700 (PDT)
After the hearty discussion of AVS and SS, let me
raise a related point and see what the consensus (or
range of opinions) is within the SwissList community.
Since we all just filed taxes (hopefully before
midnight tonight!), it occurred to me that IRA or
supplemental contributions to a 401(k) plan, which are
an important tax savings device for US tax payers, are
a double-edged sword for expats (even for long term
expats). On the one hand they allow you to defer
current taxes and to benefit from compound interest on
pretax income; on the other hand these tax-deferred
savings cannot be transferred back to Switzerland
before age 59-1/2 without a 10% tax penalty. I am not
sure if such IRA or 401(k) savings can be transferred
to a restricted savings plan in Switzerland, such as a
pension plan or "3rd pillar" vehicle.
So what are the opinions out there: should one max out
on supplemental contributions up to the maximal
allowable limits (recently raised under the Bush tax
laws)? Can these savings be transferred to "buy into"
Swiss (defined benefit) pension plans without penalty?
Can one keep these tax-deferred vehicles while living
abroad until they become unrestricted at age 59.5
without running the risk of confiscatory taxes along
the way or upon retirement? -- Your considered
opinion is welcome (though it's too late for this
year's tax planning...
-Sven
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Received on Fri Apr 16 2004 - 05:16:10 PDT
