Foreign funds transactions

tmwang31

Hello freetax community,

I hold investment funds outside of the US in Germany . I plan on selling those and tax will be deducted automatically. When I transfer those funds to my US bank account. Will there be any additional taxes I am responsible for?

MatthewD

Hello,

As a US resident (I am assuming you are), you are taxed on all your worldwide income, including any investment income, like capital gains. When that happens, you may claim a foreign tax credit on our return as a nonrefundable credit. See Form 1116. So you need to report that income on your tax return and claim the credit. Unfortunately, we currently only support that situation if the investment is reported on a Form 1099-B. You may need to use another service this year to report the sales.

There are no additional taxes on the transfer to your bank account, that I am aware of.