Different types of visas/DNI- benefits /disadvantages?

[darmanad]

Are you a US citizen? if so, then having a non-tourist visa for living in ARG will allow you to be a tax resident of Argentina, which means that you will be able to exclude about US$100k from your US taxes. in addition, all taxes you pay in ARG, can be deducted from your US taxes.
About your apartment, the issue is that as you are not a resident, the gvmt assumes you are renting out your apartment, and they assess a tax based on what they assume your rental income is...you must pay that every year or face interest on the tax (like 25% or something harsh). I have a friend who sold an apt after 6 years and made nothing on the sale as all his profits went to pay the ARG gvmt taxes because he was not a resident.

I am going to put this as clearly as I can: if you reside in ARG on a tourist visa, but are actually living here permanently, then you are taking a risk. Laws do change, and they change rapidly, and they change usually not in your favor. It is entirely possible that the gvmt decides to seize all the property owned by tourists. The only way to protect yourself from future law changes is to get yourself legal rights per your legal status in the country. For example, being an illegal immigrant in the US used to be not a big deal, but things have gotten harder and harder recently..

Thank you . I appeciate the sincerity with which you write, however I am a little confused.
I am a US cit. Do I understand you to say that with a resident visa I would be obliged to pay income tax to the AR government on all income wherever earned? Including any 401k or IRA withdrawls (treated as ordinary income for US fed tax purposes and taxed at the source in the US)?
How does my resident visa allow me to escape about US $100,000 taxes from my US taxes ?...especially if I am paying tax on that same 100K to Argentina (and probably at a higher rate) than I would be in the US? Obviously, if my tax obligation to Argentina would be greater than my tax obligation to the US , then there is nothing I would be saving by submitting to the AR system...or have I misunderstood something?
About the failure to pay tax on the supposed income of my apt here, I was led to believe I can demonstrate it was not a rental unit by showing past utility bills and my passport which would demonstrate non-occupancy during the time I was out of Argentina. Again, I am not overly concerned with any tax penalties or consequences that would come due on my death. At least that is one benefit of dying.

 

[steveinbsas]

Its academic for me, but I thought the property tax did not kick in until one had domestic assets of 305K irrepsective of whether they have a resident visa or not.

Nonresidents are subject to the bienes personales tax on all of their assets in Argentina. The 305K exemption simply does not apply to them.

 

[gunt86]

.. I would be obliged to pay income tax to the AR government on all income wherever earned? Including any 401k or IRA withdrawls (treated as ordinary income for US fed tax purposes and taxed at the source in the US)?
How does my resident visa allow me to escape about US $100,000 taxes from my US taxes ?...especially if I am paying tax on that same 100K to Argentina (and probably at a higher rate) than I would be in the US?

To be honest, this is a question for you to discuss with a sophisticated cross border tax attorney or accountant. However, I can assure you that very few (if any) Argentines actually pay tax on their worldwide income.

About the failure to pay tax on the supposed income of my apt here, I was led to believe I can demonstrate it was not a rental unit by showing past utility bills and my passport which would demonstrate non-occupancy during the time I was out of Argentina.

Theoretically what you were told was correct, but in practice it is near impossible to prove yourself out of this tax.

 

[steveinbsas]

I am a US cit. Do I understand you to say that with a resident visa I would be obliged to pay income tax to the AR government on all income wherever earned? Including any 401k or IRA withdrawls (treated as ordinary income for US fed tax purposes and taxed at the source in the US)?

If you have permanent residency and own property here, your worldwide income and assets are taxable in Argentina.

How does my resident visa allow me to escape about US $100,000 taxes from my US taxes ?...especially if I am paying tax on that same 100K to Argentina (and probably at a higher rate) than I would be in the US? Obviously, if my tax obligation to Argentina would be greater than my tax obligation to the US , then there is nothing I would be saving by submitting to the AR system...or have I misunderstood something?

You must live outside the US for about 335 days a year to qualify for the foreign income exemption. It only applies to earned income and you must file a special form. I'm not sure this applies to US citizens living and working in Argentina. It may only apply to certain industries and if there is no "tax treaty" between the US and Argentina, the exemption might not apply.

About the failure to pay tax on the supposed income of my apt here, I was led to believe I can demonstrate it was not a rental unit by showing past utility bills and my passport which would demonstrate non-occupancy during the time I was out of Argentina. Again, I am not overly concerned with any tax penalties or consequences that would come due on my death. At least that is one benefit of dying.

You are correct that if the utility bills are near minimum levels when you are out of the country that you will not be taxed on assumed rentals when you sell.

 

[darmanad]

If you have permanent residency and own property here, your worldwide income and assets are taxable in Argentina.

You must live outside the US for about 335 days a year to qualify for the foreign income exemption. It only applies to earned income and you must file a special form. I'm not sure this applies to US citizens living and working in Argentina. It may only apply to certain industries and if there is no "tax treaty" between the US and Argentina, the exemption might not apply.
You are correct that if the utility bills are near minimum levels when you are out of the country that you will not be taxed on assumed rentals when you sell.

I am not fully knowledgeable about income tax rates, but if memory serves me right the tax % is higher in Arg than in the US - at least at my modest level. Enough of a reason for me not to want to have a resident visa right there. Especially true if one could stay under the radar on property tax... which is not subject to anything close to 1.25% tax in Brasil (my Brasilian property tax is about .2%)
In any case, the foreign income exemption applies to income earned outside the US. My 401k/IRA withdrawl is not income earned outside the US. Until such time as I get a job paying a local salary I am not going to benefit from any such exemption. This is highly unlikely.
I can deal with the government's desire to tax me on alleged rtental income either when I sell or not at all after I die.
Steve, I'll be in BA at the end of next month and the wife will not be joining me until a few weeks later. May I invite you and or your spouse out to dinner?

 

[steveinbsas]

Steve, I'll be in BA at the end of next month and the wife will not be joining me until a few weeks later. May I invite you and or your spouse out to dinner?

Thank you for the invitation, but I would prefer you come to my place for dinner:

http://www.remax.com.ar/PublicListingFull.aspx?lKey=91babcc3-4c00-4ba0-a557-2c1e4c15f884&Index=3

Unfortunately, it's 650 KM from Capital Federal (I moved here in June).

Nonetheless, you are always welcome.

 

[soulskier]

http://www.argentinaresidency.com/

benefits to a visa (rentista or other non-tourist type):
-able to get a DNI
-able to get subsidized airfare on Aerolineas Argentinas
-able to open bank account
-able to get a monthly cell phone plan
-able to work legally
-able to apply for permanent residency after a few years
-easier to import personal goods duty free
-can get a driver's permit
-can buy a vehicle
-able to sell property without the 'rentiers' tax

The DNI also allows you to get great discounts on National Parks, Season Ski Passes and setting up utilities, etc. If you are going to live in Argentina for a long time, it is a nice thing to have.