the past few years have been tough. as a result i have built up a sizeable capital loss carryover amount. (i am a US citizen). i am seriously considering relocating to a new country, perhaps canada or maybe even spain. i would like to ask what would happen to my carryover capital losses when i move and live in another country, particularly with regard to my tax obligations in my new country. say for example, i decide to move and live in canada/spain in 2019. let's say i make money trading the US markets for that year. my question is: will i be able to offset my gains in 2019 with my capital loss carryovers FOR my canadian/spanish tax obligations.
As long as you are still a U.S. citizen, you have to pay U.S. income taxes, no matter where in the world you reside. So your capital loss carryovers should still apply. Also, you get to deduct any foreign taxes paid. The only way around this is to become a citizen of another country, and renounce your U.S. citizenship. Or, remain a U.S. citizen, move to Puerto Rico, and apply for Act 22 status.
hi DaveV, thanks for the reply. let me be more clear with my question. with regard to my US income taxes, yes things are clear with that. i still have to pay taxes wherever in the world that i reside. and yes my capital loss carryovers still apply. my question concerns taxes in my new country of residence. in my example above, all my new country sees is that i made X amount in $ in 2019 while residing in their country. thus i would assume they would assess me capital gains tax for those gains in 2019. i do not know if i can deduct my carryover losses from the past against my 2019 gains for my new country's taxes.
This will depend on which country you decide to move to. Each country has its own tax system. For example: not all countries have a "carryover losses" clause in their tax system. I fear that you question is too generic to answer.
i am considering two countries: canada and spain. i had mentioned this in my original post. would appreciate any experiences or information on the tax system of these countries, specifically if carryover capital losses that have been generated while outside of these countries, can still be utilized in these countries once i am living there.
Prior to moving to a new country, you should consult with experts on that country's trading-related legal and tax issues. There could be MANY other relevant factors or considerations beyond just your specific question, which could either save or cost you huge amounts of money. You will need to speak with specialist lawyers and accountants for this, don't get advice on such critical subjects from an Internet forum.
hi specterx. yes, that is true. i brought up the topic with my US accountant. i will await his reply. but i would think best would be to consult tax experts in canada and spain. i just wanted to throw it out there in the forum. sometimes, someone has experieced something similar in the past. worth a shot. cheers.
Let's start with the obvious. If you continue to file a US tax return, your carry-over losses should apply to that return, regardless of where you reside. Doubt your losses would carry over to tax filings in other countries.