A journey of a 1000 miles begins with a single step

Share your story
21

https://www.amcham.ch/publications/downloads/2011/flaws_in_the_current_US_Swiss_estate_tax_treaty_and_the_need_for_a_modern_treaty.pdf

You’re not happy with that one? (written by international tax experts) While they rant about the treaty (obviously they’d like it to be even more favorable, which is why they take amounts way higher than the exemption), they also give concrete examples of how the exemption applies (in short if your worldwide assets are below the current US exemption, currently 11M for single filer, you’re fine).

Edit: that said being above 60k will mean having to do all the IRS filing, so why you might not owe anything to the IRS, doing the filings is probably not super fun.

1 Like
22

Yes, I’m relaxed. I find this thread instructive enough. If I accumulate bigger stash and/or get older I’ll consult my tax lawyer.

2 Likes
23

Hi Bojack, unfortunately I didn’t find the blog entry which I was referring to.
Anyway, there’s a thread about securities lending (Wertpapierleihe) here
It’s in German though. Seems that Vanguard is getting more profit from lending, plus they have smaller TD (tracking difference) vs the index than other funds.

So you have to pay the TER of 0.26%, but if the Vanguard fund performs better vs the index (let’s say 1% vs 0.75% for the other funds), then you pay less overall for Vanguard.

24

Checked again, and it’s indeed the TD which is playing a big role. You have a TCO for an ETF, which consists of internal costs (TER, securities lending, swap fees) and external fees (bid/ask prices, taxes).

In the last 5 years, VWRL has had a negative TD (meaning they were better than the index), see here
If you compare to ACWI funds, that’s a lot better: here

So the VWRL is better in terms of TCO than a lot of other ETFs, even though the TER is higher.

25

Hoi folks,

Sorry to not be more active/reactive but quite busy these days (yeah I know, everything is a question of prioritization :slight_smile:).

Anyway, about this 60k limit, I was quite convinced after detailing all the sentences of the legal blabla.
Then I got in touch by coincidence with people looking more informed about the topic. They wrote this paper: https://www.amcham.ch/publications/downloads/2011/flaws_in_the_current_US_Swiss_estate_tax_treaty_and_the_need_for_a_modern_treaty.pdf
So far, I’m getting even more confused by the answers about this 60kUSD limit.
My next step is to have a phonecall with the guy to be sure we talk about the same situation details.

I will for sure let you know about my findings!

5 Likes
26

What’s unclear in that paper (they give pretty clear examples)? The “flaws” they describe only apply to worldwide wealth amount above the US exemption.

X = global wealth
Y = US situated wealth
E = US exemption (11M or so at the moment)

The exemption applied to the US assets Y is going to be E’ = E * Y/X (exemption prorated to global assets).

From that we derive E’ >= Y iff E >= X (total US situated assets are fully exempted if and only if the total wealth is lower than the US exemption).

Hope that clarifies :slight_smile: (also all the examples in the paper are above the US exemption)

2 Likes
27

Completely agree with you and I assume(d) the same.
Except that I talk to one of the person who wrote the article with my specific usecase (family situation) and the answer was I wasn’t exempted… which is why I’m confused.
Anyway, will clarify this and keep you posted!

2 Likes