Brazil Expat Forum

Taxes on US earned retirement $$ ?

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10/2/2009 14:49 EST

My question is about anticipated taxes on my retirement income - 401K, pension, Soc Security. Since I earned my money in the US, I know I must file and pay US taxes once I start to receive it. How will I be taxed in Brazil when this money is transferred to a Brazilian Bank? Is it taxable in Brazil?

I will be retiring in a few short years. We live in the US now. I am married to a Brasileira, so I will get a Permanent Visa before moving.

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10/3/2009 08:27 EST

In general, you only pay taxes in one country for all money earned from all countries - even the US tax form ask if you have earned money anywhere else.
I am guessing that if you are going to retire in Brazil, you will be applying for a retirement visa, which you can get as long as you have 2000 monthly income. With that visa and CPF, you will be required to file the Brazilian tax forms to keep your status. In 'general', and I'm careful in saying that, you will be paying taxes in one country, but reporting it in both.
Its a different situation if a person is earning income in two countries. Then a person may be paying the higher tax bracket of the two countries.

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10/3/2009 11:21 EST

Thanks for the response. Are you sure there is no Brazilian Taxes applied to my Soc Sec, 401K and my Pension received from my US sources?

If I understand correctly, I'll file taxes in both countries, but I only have to pay taxes in the U.S.

But, if I am filing a Brazilian Tax form, don't I need to state my "worldwide" income? Is there somewhere where I say taxes have already been applied? That "income" is the money that is received each month from my U.S. income sources. And Brazilian authorities don't want a piece of that in the form of taxes?

We'd "heard" that taxes were to be paid in both countries as Brazil has no treaty with the U.S. that avoids double taxation. That made the idea of moving to Brazil seem like a horrible idea to me! We are very confused about this, as the Tax issue could be a deal breaker!

Lastly, I am married to a Brazilian, so I'll have a Permanent Visa, not a Retiree Visa.

Again, Thank you!

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10/3/2009 14:38 EST
"All U.S. citizens, including those who do not live in the United States, are subject to U.S. income tax on their worldwide income."

Aside from that, if you live more than 180 days a year in Brazil you'll also be taxed in Brazil, and also for your worldwide income.

You'll probably be able to avoid double taxation by declaring in Brazil the taxes that you payed in the US (or the other way around), but I don't know the full details of how that works.

Here you'll probably find people that know the complete answer to your needs:


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10/3/2009 19:38 EST

I found this:

Foreign nationals who are tax-resident in Brazil are required to pay tax on their Brazilian and overseas-generated income, unless covered by a Double Taxation Treaty between Brazil and their home country, and must file an annual tax return in April.

Foreign nationals become subject to tax-residence status if they stay in Brazil for more than 183 days in any 12-month period, and this status applies for 12 months after their last departure from Brazil.

So I do pay taxes twice! Wow!

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10/4/2009 14:30 EST

No, you aren't taxed twice on the same money. If you pay taxes in the US, then you claim that credit on your Brazilian form. Thus, if you pay taxes in Brazil, you claim that on your US form.
Depending on where you claim your residence, the only amount you MAY have to pay would be the difference in the tax rates betweent the two countries on the total income.

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10/4/2009 17:48 EST

Thanks, I understand now. That is a relief.

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12/30/2009 09:45 EST

I have reseached this a zillion times without the same answer twice!....All the expats in brazil whom I know tell me that they never file taxes and live off funds from atm's....My advice to you and I am sure your wife agrees is to stay out of the system there as much as possible!.....Brazil is one of the must corrupt countries and I know as I have been there more than 10 times and all over brasil except mata grosso and the amazons...Lawyers there are corrupt or incompetent or both!...Be careful of tel conversations as they can "quebrar siglio", that is, record yours without authorization from a judge unlike here!.....I here all types of general advice about income taxes there without specific details, e.g., how do they know your income as they do not get copies of 1099's nor w2P's etc....The devil as usual is in the details and that is what one must find out!.......Boa sorte!

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6/16/2017 12:47 EST

The person above is not correct. You do not simply take the US tax you pay and claim a credit on the Brazilian tax return. That works in many countries, but not all, and not Brazil. The US has tax treaties with a number of countries that allow residents of one country to take a credit for taxes paid to another. WE have no such treaty with Brazil. So if you follow the law, there is no credit for the US taxes paid on your Brazilian tax return. Brazil has treaties with many countries, such as the UK, so if it was UK tax, then you would claim the credit.

Also, Social Security is always US-sourced, so you can't take the Brazilian taxes as credits against it. Other pensions have to be analyzed to see where the person was working when the contributions were made to determine if it is US- or foreign-sourced income.

I am a CPA with over 30 years' experience with expat taxation. Let me know if you have any more questions.


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