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I have read this post (How to realize capital gains before going from non-resident alien to resident alien in USA) and would like to ask a follow-up question.

It's understood that capital gains should be made PRIOR to being a US resident so to avoid US taxation on these gains. That makes sense especially when the tax is less in your originating country that it is for such gains in the US.

OK but WHEN should the stocks sale and the gains be made? What would be the deadline to execute this operation? Before physically moving to the US? Before April 30th (end of US FY if I am not mistaking)? Before the start of your US visa?

Thanks for clarifications.

  • The financial year for individuals in the US is the calendar year, unless you explicitly chose differently on your first return (which you should probably not do if you live in the US). – littleadv Jun 16 '15 at 15:58
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Before you become a US resident for tax purposes. Depending on your immigration status, that may be the day you enter the US, or the beginning of the first year when you fulfill the substantial presence conditions, or the date on which you switch status which allows you being resident if you're filing a dual status return.

  • Thanks, that's an interesting start. Can you or one please elaborate about what the situation would be according to some common immigration visas: - H1-B - L1 - DV - J1 Let' take the example of someone moving to the US in July. Visa being granted in April. When should he/she sell its stocks to avoid capital gain taxation? – Bob Jun 18 '15 at 7:37
  • @bob this is not a forum for hypothetical discussion. So let's not. – littleadv Jun 18 '15 at 7:43

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