International Wires from US to Argentina. Risk of Account Closure?

[autoluminescent]

But how did that happen? You said “since I'm a full-time resident ARCA has come for their share” what does that mean exactly - they reached out to you?! They knew you were making money overseas, and how much? How? I’ve never heard of that happening to anyone. What happened

No, it just means that I declare my income as I am a full-time resident and have worked/ lived here for almost 3 years haha. I know the common wisdom on these threads is to avoid paying taxes, or to be in negro/ gris, but I earn enough to live a comfortable life here and believe in contributing back to the society of which I am a part of.

I also feel uncomfortable with the idea of telling the IRS that A) I don't live in the US and therefore do not owe US income tax and B) I also don't pay taxes in my country of residence.

 

[Alby]

Deleted comment (redundant after reading comment above).

 

[dlish]

I declare my income as I am a full-time resident and have worked/ lived here for almost 3 years haha

Oh you sweet idealistic summer child. Do you hate money?!

Look, in many countries paying taxes does contribute to society, but look around you. Your money is contributing to some politician’s Miami Beach penthouse mortgage.

I also feel uncomfortable with the idea of telling the IRS that A) I don't live in the US and therefore do not owe US income tax and B) I also don't pay taxes in my country of residence.

It doesn’t work like that. You don’t get to tell the IRS if you owe them tax. You owe them regardless of where you live, but in some cases with tax treaties get to discount your foreign tax off of your US tax obligation.

I know the common wisdom on these threads is to avoid paying taxes

The common wisdom is common for a reason…

 

[autoluminescent]

Oh you sweet idealistic summer child. Do you hate money?!

Look, in many countries paying taxes does contribute to society, but look around you. Your money is contributing to some politician’s Miami Beach penthouse mortgage.


It doesn’t work like that. You don’t get to tell the IRS if you owe them tax. You owe them regardless of where you live, but in some cases with tax treaties get to discount your foreign tax off of your US tax obligation.


The common wisdom is common for a reason…

HAHA I was waiting for a wiser/ wealthier person to come here to tell me that..

Unfortunately, I have more anxiety than common sense, so I opted to go 'blanco' here to keep my nose out of trouble with the IRS/ARCA. I'm content with my life here and prefer to have peace of mind over a bigger bank account. No shade towards anyone else who has figured out a better way to operate down here.. Now that the CEPO has been lifted, life's a bit easier (albeit more expensive) in terms of exchanging dollars to pesos and vice versa.

Anyways, does anyone have any advice regarding the wire transfer situation? I keep reading horror stories of expats getting their US accounts closed down. I'd love to find some alternative method to transfer money here without raising any red flags with my US bank.

 

[dlish]

Anyways, does anyone have any advice regarding the wire transfer situation? I keep reading horror stories of expats getting their US accounts closed down. I'd love to find some alternative method to transfer money here without raising any red flags with my US bank.

Have you considered the crypto route? Many cuevas accept USDT which is a stable coin - it’s pegged to the dollar so never loses value. It’s no different than any other transfer. You’d transfer your dollars to your Coinbase account, buy USDT with it. When you need money here, you send it to the crypto address the cueva gives you, and they give you peso.

 

[autoluminescent]

I've thought about it. I've read that some banks (Chase in particular) do not like their clients buying crytpo as they view it as a high-risk asset, and may close your account for doing so.

To answer my own question, I really need another bank account haha. I saw some mention earlier Charles Schwab International as a good choice. I just don't want to get caught in a situation where my account gets closed and I have no access to my funds without a costly trip back to the US..

 

[Alby]

Anyways, does anyone have any advice regarding the wire transfer situation? I keep reading horror stories of expats getting their US accounts closed down. I'd love to find some alternative method to transfer money here without raising any red flags with my US bank.

This shows up why even the doing right is hard. You generously opt to pay double taxation, yet doing so throws up a completely different problem that leads to a different type of anxiety.

 

[Cordoba]

Oof, yeah it has been a huge fear of mine but I've been here 3 years so far without any major banking issues. I normally do the same, wire my living expenses via Western Union but since I'm a full-time resident ARCA has come for their share. I run a US-based LLC and made more last year than the Monotributo limit so I'm stuck under the Regimen General. Being a US citizen living in Argentina means my combined tax rate is over 40% thanks to no tax treaty

Wouldn't the foreign tax credits and/or earned income exclusions if self-employed or w2 cover any USA tax liability? Or it is the paying into self-employment/FICA taxes in both systems creating the 40%.

 

[autoluminescent]

Wouldn't the foreign tax credits and/or earned income exclusions if self-employed or w2 cover any USA tax liability? Or it is the paying into self-employment/FICA taxes in both systems creating the 40%.

Exactly. Under FEIE, up to $126,500 in earned income is excluded, however, the 15.3% self-employment tax is separate tax not exempt by FEIE. ie. if you are self-employed and made $100,000, that full amount of $100,000 is excluded from income tax in the US but you are still obligated to pay $15,300 in self-employment tax, which is essentially Social Security and Medicare taxes. My income tax rate in Argentina was between 25-30%.

Using the above example, If I made $100,000 last year, I paid $15,300 in self-employment tax to the US, and $25,000 in income tax to ARG = ~40% tax rate.

Obviously the Monotributo system has far less tax burden than the upper limits of RI, so depending on your income it may not be as bad as my situation. Living here as a high earning, self-employed US citizen is pretty much a terrible idea (if you play by the rules, that is).

 

[redlobster]

In order to pay my Argentine taxes I'll need to wire myself around $5k per month - has anyone had any issues with US banks closing your account

Have you considered the crypto route?

Everyone knows the safest way to pay your taxes is to first wire the money to a friend's account in Yemen or North Korea, and then have them forward it to Argentina.

But seriously, if your bank cannot accommodate your basic needs - like paying taxes - you should switch banks.