Cross-Border Financial Planning - US and UAE

US and UAE cross-border financial planning is the process of coordinating your US tax position, UAE residence, retirement accounts, investments, bank accounts, estate planning, currency and future relocation.

A review should usually consider:

• US citizenship or green card status
• whether US tax filing continues
• whether foreign earned income exclusion may apply
• whether foreign tax credits may be relevant
• whether state tax remains an issue
• UAE residence position
• UAE employment income and bonuses
• RSUs and stock options
• UAE end-of-service benefits
• US retirement accounts
• 401(k), IRA, Roth IRA, TSP, 403(b) and 457(b)
• US brokerage accounts
• UAE bank accounts
• FBAR and FATCA reporting
• foreign investment products
• PFIC exposure
• property in the UAE, US or elsewhere
• life insurance and protection
• US and UAE wills
• guardianship
• non-US spouse planning
• future relocation to the US, UK, Europe or another country

The IRS says US citizens and resident aliens abroad are generally subject to tax on worldwide income.

That means the US often remains central to the plan even where you live and work in the UAE.

The UAE may create the opportunity to build wealth faster, but the planning needs to be suitable for a US-connected person.

The UAE can help Americans build wealth quickly.

But the wrong structure can create long-term problems.

Common issues include:

• large cash balances with no investment plan
• foreign bank accounts opened without reporting awareness
• UAE or offshore investments bought without US tax review
• PFIC exposure from foreign funds
• old 401(k) accounts left unmanaged
• IRA and Roth IRA planning missed
• employer stock concentration
• UAE end-of-service benefits treated as a full retirement plan
• life insurance arranged without estate planning review
• US wills not coordinated with UAE documents
• beneficiaries not updated after moving abroad
• no clear strategy for leaving the UAE

A strong US/UAE plan should answer:

• what should stay in the US?
• what should be held in the UAE?
• where should surplus cash be invested?
• which currency should be used?
• how should old retirement accounts be managed?
• what US reporting is required?
• how should family protection be structured?
• what happens if you move to the UK, US, Europe or elsewhere?
• what happens if you retire outside the UAE?

The aim is to make the UAE years deliberate.

The UAE can be a high-income phase, a savings phase, a business-building phase or a pre-retirement phase.

The financial plan should be built around which one applies to you.

This page is for general information only and does not constitute personalised financial, tax, legal, investment, pension transfer, retirement, estate planning, insurance, immigration, UAE residence, UAE tax or currency advice.

US and UAE cross-border planning, US tax, UAE residence, foreign earned income exclusion, foreign tax credits, FBAR, FATCA, 401(k), IRA, Roth IRA, TSP, investments, PFICs, offshore bonds, UAE bank accounts, UAE property, estate planning, wills, guardianship, life insurance, non-US spouse planning, currency and future relocation depend on personal circumstances and may change.

US tax advice should be taken from a suitably qualified US tax adviser or CPA. UAE tax, legal and residence advice should also be taken where relevant.

Financial planning should be coordinated with legal, tax, pension, investment, insurance and estate planning advice where appropriate.

Investing involves risk. Pension, retirement account and investment values can fall as well as rise, and you may get back less than you invest.

Currency movements can affect the value of cash, investments, retirement accounts, transfers, withdrawals and future income.