tresco

As a US citizen (naturalized ex-pat), I guess I should put some money by to cover tax liability just in case.

I'm still interested to learn how you report lump sum income (as a 1099-R?), and how you cite the relevant tax treat provision ... or a pointer to where I can learn more.

Thanks, Tony

Harty M

This is an extended thread with lots of history, BUT is there anybody out there who has (or is about to) take action via QROP who will share their experiences (good or bad) to benefit the rest of us considering this important move. Today, I have been quoted by QROPS Advisor 8% of the value of my fund to effect a transfer + currency exchange impact that will further reduce the yield. There must be a safe economical route we can employ, if only we can pull together to identify it.

Dogspeak

Well, I'm still in the midst of trying to resolve my own situation which, in the end, didn't go the QROPS route but is hoping to go via an alternative UK SIPP who will not have a problem with my eventual US residency.

im9907620

Harty, there is a vast range of charges being quoted for QROPS work. Now 8% on a £20,000 fund is not unrealistic, but 8% on a £75,000+ fund is a lot, especially before QROPS trustee charges as well. It will also depend on what other advice/guidance/assistance you get for your fee. Most unregulated advisers seem to be charging between 6-10% and are not too interested in how the QROPS will impact your taxes, just more interested in taking the fee. If you are looking at trying 2 access a lump sum there are tax considerations, not to mention the exchange rate (I know, not brilliant right now!). I would recommend the view of a good technical CPA before you proceed

Unless you physically need the cash in the US, then do you really need a QROPS. Most people should weigh up the pros and cons of staying with a UK pension (or SIPP) against trying to get it to the US (after tax, charges, currency risk all take a chunk out). Those who badly need the money in the US are the ones, inevitably, who fall prey to the high charge firms.

OttoVonKen

If anyone has a copy of the Citi (or any other US pension scheme provider) QROPS letter, I would be most appreciative if they would post it or give a locations where it could be obtained. Someone at Scottish Widows, who struck me me as very financially sophisticated (I asked lots of tough questions) assurred me that such trnsfers to the US happen all the time. he even directed me to the QROPS pdf. Given that it is not to SW's advantage to offer such information, it struck me as passing the truthfullness smell test. He did note that I'd need to include the letter with my request for a transfer.

OttoVonKen

If I'm able to sort this out, I will happily copy this community on each step in the process. For example, what company that I transferred it to, in which of their locations, which advisor I worked with and what my experience was with him/her.

In the interest of full disclosure I'm a tax counsel by training, but have no experience in these matters. Under the general principals of tax law, assuming that such transfers ("rollovers" is US-speak) are allowed on a tax free basis, the amount is shown as "other income" and then backed our as a non-taxlable transfer).

nun

IRS won't recognize your UK pension fund as "qualified", so you cannot do a tax free rollover. It doesn't matter whats on HMRC's QROPS list. Also I believe that the US funds on the QROPS list are only available to employees of the companies mentioned. I could be wrong, but i think I read that somewhere.

Bottomline leave your UK pension in the UK

Ray

I concur

im9907620

Hello Otto, I think 'someone' must have been drunk to make a comment like that.

Give it up, a tax free roll-over to the US is not going to happen my friend....

There is already an IRS private letter ruling (2008-09) which virtually kills the notion.

That said, if its dollars you are after then most QROPS will operate in dollars for you.

Polarsub

Has there been any light shed in this area recently. I want to “cash out” my 34K held in a UK private pension. I want to use it for a second property deposit here in California as the housing market is so deflated right now. I am relatively young and have a few other ducks lined up for retirement and think this would be a good investment for me and my family. That being said, I would really be interested in the tax implications. I have talked to several advisers and they all say it can definitely be done, but no one is clear on what happens the US end. I don’t mind taking a 20% hit this end as I still have enough to secure a home in the price range I am looking at and have already been approved for the mortgage. I’m just wondering if anyone has experienced a similar scenario and if so, how much was the actual cost/fees/taxes etc. I am holding a long term green card, have been here 3 years, I will apply for citizenship this year and live in California.
Hope someone can help! Thanks…