henryc

My wife, a USC and I, a UKC are currently living in the UK. I'm thinking about transferring some of my savings which are in pounds into her US bank account as I think the pound is likely to fall further against the dollar and we're planning to move to the US sometime soon so will want our money to be in dollars anyway.

Is there any reason why I should not do this? Any tax reasons etc? I'm guessing the US authorities would regard it as part of her worldwide income and that she would have to declare it when doing her taxes?

Any advice greatly appreciated.

H

md95065

Shouldn't be any tax implications on transfers between a husband and wife - and savings are not income.

There is no limit on how much you can transfer, but there are reporting requirements for amounts over $10,000 (I think) - but the bank should take care of that for you.

avanutria

She's free to move it and it should be very easy. We use UKForex to convert it to dollars and there are no fees on that end, and a flat $12 fee for our US bank to receive it. We're moving the proceeds of our UK house sale that way in a couple of weeks.

When your wife does her taxes there's a question about whether or not she has over $10,000 outside the US. She should mark Yes. There's then a separate document that she'll have to file, I think she has until June to do it. (I still have to do mine for this year...) I forget the name of the form but it'll say on the federal return document, and you can just google it to find it.

Jerseygirl

The OP said the funds were in his name in the UK...so there is no need for his wife to declare it.

BritishGuy36

a) It may fall in the [very] short term - but what do you think will happen once the economy catches up with the fact that Obama thinks it's fun to just keep printing money? Inflation is going to go through the roof and the dollar is going to go into the toilet. I have money in the UK too; it's staying there until it hits $2 to £1...which may well happen later this year/early next.

b) Moving money is not a taxable event. Remember you've already paid tax on the savings in your bank account. It's not income, it's savings.

avanutria

Oops, my bad - I thought it was in her name. If they move it after he becomes a PR will he have to fill out that form I mentioned?

Jerseygirl

I believe he will.

wordfool

Darling has been just as guilty of printing money recently and I have more faith in US monetary policy going forward than the UK's right now. The UK is also in a worse position than the US if you look at the ratio of debt financing costs to GDP growth projections, not to mention the fact that housing prices in the UK are still far from corrected as mortgage rates are about to start increasing while in the US they've generally over-corrected already.

So I'm not sure we'll see $2 to the pound any time soon regardless of any US federal government policies. It'll just keep bouncing between $1.50 and $1.70 depending on the headlines of the week IMO. And currency hedging is a notoriously tricky beast, even for the professionals

henryc

Thank you all very much for your replies.