[Dunkelcreature]

I wasn’t going to use the house sitting address as my Jan 1 address, just my current address. I will be here when the tax notice comes. I didn’t know about the consequences for the homeowners, and I certainly want to avoid complications for others. My real question is what does one do when one doesn’t fit the mold? I had a break in temporary housing, and rather than find something that didn’t suit me, I decided to go traveling until another opportunity arose. It just happened to occur during the dates that so many things are based on. Is there any other solution? Any ideas?

 

[Bevdeforges]

what does one do when one doesn’t fit the mold?

That's a really risky position if you are living in . Your "residence" is an important part of your identification here and whatever address you give, you will be considered responsible for any and all information, forms and other documents the government may send to you there.

 

[Dunkelcreature]

That's a really risky position if you are living in . Your "residence" is an important part of your identification here and whatever address you give, you will be considered responsible for any and all information, forms and other documents the government may send to you there.

I see your point there. Here's another question: If I go traveling for July and August rather than December and January, and arrange to have someone get my mail just as I do in Dec/Jan, is that risky too? I'm not trying to be argumentative, I'm just trying to figure out how to pay my taxes even though I'm retired and enjoy traveling, and want to live in .

 

[Dunkelcreature]

Where do you receive your postal mail? Because they officially want to know your address as of January 1st of 2024 (or as of the date you first moved to if it falls in 2024) and, if applicable, the address you are using currently for filing your taxes (ostensibly your address as of January 1st 2025 - since that is what is used for taxe d'habitation purposes).

Also, thanks for the info on taxe d'habitation - there's a whole other world to research!

 

[Bevdeforges]

and arrange to have someone get my mail just as I do in Dec/Jan, is that risky too? I'm not trying to be argumentative, I'm just trying to figure out how to pay my taxes

Actually, the Fisc has already figured that one out. You'll note that on the 2042 form you are asked for your bank information so that the Fisc can take the initial payments (they do it in installments if the amount due is more than a certain level).

 

[Dunkelcreature]

Next question for first time filers on 2042, section 6, about box 6QW - to check if you are newly domiciled in in 2024 'Vous êtes nouvellement domicilié en en 2024'. It seems so straightforward that the answer would be to check it. But section 6 on that form is for deductible charges, and a subheading is retirement savings. Also, check mark on first page indicating this is my first year to file already basically says the same. Am I overthinking?

 

[Bevdeforges]

A quick check of the forms leads me to think that because it is in the section for Epargne de Retraite it has to do with someone who is eligible for the deduction for contributing to a retirement savings program (kind of like an IRA in the US). Doesn't apply to you.

 

[Dunkelcreature]

You put dividends and interest in Section 2 of form 2047K. Dividends on line 210 and also line 221. Interest goes on line 240 and again on line 251. Then you have to put it in Section 6 Revenus imposable ouvrant droit a un credit d'impot egal a l'impot francais. Then on form 2042 put it on line 8TK. I also put a comment in the comments section just in case:
Selon à les articles 18 et 24 US/ Tax Convention, nous ne sommes pas imposé, nous
ne payons pas les impôts francaises ni les charges sociales sur nos retraites
americaines, ni les interets, ni les dividends.

I hope this helps.

Just come back from centre des impots. Show them the article 24 of the tax treaty and they waived the tax on dividend and interest.You put dividends in line 210 and 221. Interests in line240 and 251 you don’t put them in section 6 they told me it is only for retirement income(ss.ira.roth ) then your report section 6 on form 2042 line 8TK. and they told me I had to tick box 2OP on form 2042 too which I didn’t when i filed. Job done no tax on us dividends and interest.

This information ⬆ from past threads is invaluable, so thank you. Anyone know where to put capital gains? Thanks in advance!

 

[Bevdeforges]

"Capital gains" are "plus-values" in French. Look for the term on form 2047 and on the instructions ("Notice") for form 2047. The current 2047 form seems to indicate where to carry the various lines over to the 2042 form.

Also, consider ing the 2047 instructions (Notice) as a pdf and then using Google Translate to translate it into English. There is quite a bit of information on investments and bank interest for specific countries.

 

[Dunkelcreature]

Thank you Bev! I did translate the 2047 instructions, but I didn't know the term for capital gains, so I wasn't able to find any instructions for that. Now I'll search the French document for plus-values and translate all that I find.

I should have specified in my question, retired US citizen, French residence permit, US capital gains only. So, if anyone does have an answer about capital gains, I'll still take it!

 

[snave44]

Just checking on FTC (foriegn tax credit in USA)

Gathering data for tax credit and CSG.
My understanding is that CSG and CRDS can be claimed for tax credit in the USA but not the "Solidarité" fee.
Social fees = 9,2 (CSG) + 0,5% (CRDS) +7,5% (Solidarité) = 17,2%
So of the 17,2% witholding on investment income for social fees, only 9,7% can be included in the demand for tax credit (0,2 + 0,5)
Also, the entire amount representing "income tax" (12,8%) is included for tax credit in the USA.
(Foreign tax credit)

Also the CSG and CRDS on earned/salary income ( we declare GROSS income in US filing and not "taxable income" as we do in )

 

[snave44]

This information ⬆ from past threads is invaluable, so thank you. Anyone know where to put capital gains? Thanks in advance!

This is surprising that you don't add these values into section 6. I may be wronf, but here is what I often see as recommendations :

1) The values you place in lines 210 and 221 inform line TS on the 2042. This means it is added to other dividend income you might have in . (careful, if you automate the transfer of this value into the 2042, it will cancel any French sourced dividends...you'll need to add them in manually)
2) Same for interest, placing them in 240 and 251 result sin interest informing line 2TR (french sourced interest income)...

Again, to my knowledge, anything placed into 2TS and 2TR of your 2042 will automatically be taxed unless you add these values into section 6 and have line 8TK completed on the 2042.
Line 8TK in the 2042 is what gives you French tax credit.

To my knowledge, for capital gains and CG distributions they can be placed in line 30 of the 2047 and then also added into part 6 of 2047 to increase the credit in line 8TK. Also complete the form to report capital gains.

Finally, US IRA and pensions go into Part 1 Line 12 (2047) and inform line 1AL in the 2042 to avoid taxation. The amount should also be added into Part 6 to make sure there is no tax.

Also, please note that although you DON'T pay taxes on these amounts, they are reported and will be used to calculate the marginal rate you pay on earned income. They are considered part of your taxable income when calucluating the tax rate. This is why they are reported.

Also, the box 2OP depends on how much of your income is ive (interest/dividend/CG). Placing all ive income into the 30% tax rate may not be beneficial if your total income is in a smaller bracket..but quite beneficial if you are in the highermarginal tax brackets. It is to be calculated and chosen on a case by case basis.

Good luck !

 

[calin-m]

Section 6 of form 2047 is for US CITIZENS ONLY (or whatever other countries could claim tax credit in the amount equal to what would have been charged in , i.e. "REVENUS IMPOSABLES OUVRANT DROIT À UN CRÉDIT D’IMPÔT ÉGAL À L’IMPÔT FRANÇAIS" - not sure if any other) and is to total ABSOLUTELY everything you need to claim, which falls under categories mentioned in the treaty.

Here is an example (married filing tly, with only one having pension/IRA/Roth and both having interests from banking s in the US (in the order of columns in the form 2047, section 6):

<1st NAME> - <Etats-Unis> - <interets + pension> - <the sum of section 12 form 2047 + parts of line 240 pertinent to 1st filer>
<2nd NAME> - <Etats-Unis> - <interets> - <only parts of line 240 pertinent to 2nd filer>

Also: line 12 form 2027 goes to 1AL in 2042, while total of line 240 total goes to 251, then 252 in 2047, which then goes to 2TR in 2042.

Replace above to any other categories of income that show up in the treaty.

 

[Bevdeforges]

Section 6 of form 2047 is for US CITIZENS ONLY (or whatever other countries could claim tax credit in the amount equal to what would have been charged in , i.e. "REVENUS IMPOSABLES OUVRANT DROIT À UN CRÉDIT D’IMPÔT ÉGAL À L’IMPÔT FRANÇAIS" - not sure if any other) and is to total ABSOLUTELY everything you need to claim, which falls under categories mentioned in the treaty.

Um, I'd be very, very wary of that claim. There are lots of non-US citizens who draw US-sourced pensions (due to having worked in the US for a period of time). Further to that, in the Dividends section of form 2047, there are some that apply only to US CITIZENS vs. those who have investments in the US that pay them dividends. This is really tricky territory.

In fact, in the section of the instructions on Revenus imposable en , section B, there is a whole list of the countries where the treaties use the method of a credit equal to the French tax (as long as the income has been subject to tax by the source country):

Ce mécanisme d’élimination des doubles impositions
est prévu par les conventions conclues avec les États
suivants : Afrique du Sud, Albanie, Algérie, Allemagne,
Andorre, Argentine, Arménie, Autriche, Australie, Azer-
baïdjan, Bahreïn, Botswana, Bulgarie, Cameroun,
Canada, Chili, Chine, Colombie, Congo, Corée du Sud,
Côte d’Ivoire, Croatie, Danemark, Égypte, Émirats
Arabes Unis, Équateur, Espagne, Estonie, États-Unis,
Éthiopie, Gabon, Géorgie, Ghana, Grèce, Guinée, Hong
Kong, Inde, Islande, Israël, Italie, Japon, Kazakhstan,
Kenya, Koweït, Lettonie, Luxembourg, Libye, Lituanie,
Macédoine, Malte, Mexique, Mongolie, Namibie, Nige-
ria, Norvège, Oman, Ouzbékistan, Pakistan, Panama,
Qatar, Royaume-Uni, Russie (Fédération de), Saint-Mar-
tin, Sénégal, Singapour, Slovénie, Suède, Suisse, Syrie,
Taïwan, République tchèque, Ukraine, Venezuela, Viêt-
Nam et Zimbabwe.

Ah, taxes, ain't they fun?

 

[calin-m]

... there are some that apply only to US CITIZENS vs. those who have investments in the US that pay them dividends. This is really tricky territory.

This was my intent with the highlight. During a fairly long conversation on the topic, with the local French finance publiques expat expert, last year, he was very clear that US citizenship is a condition necessary to be able to take advantage of the US - treaty. Non US citizens (residents, or else, with US financial interests) - according to him - do not qualify for the treaty provisions. Here is the paragraph referencing such, from the English version of the treaty: "The new Convention preserves the special French tax benefits for U.S. citizens residing in and for French residents who are partners of U.S. partnerships."

In any case - please allow me to apologize for my earlier comment, if it created any confusion. Just scrap it. I think it is better for everybody to the appropriate documents, and also try to validate with impots / finance publiques local services, then fill out the taxes to their level of comfort.

 

[Dunkelcreature]

To my knowledge, for capital gains and CG distributions they can be placed in line 30 of the 2047 and then also added into part 6 of 2047 to increase the credit in line 8TK. Also complete the form to report capital gains.

Hi Snave44 -
Thanks for the breakdown I have one question to clarify: in your second sentence I quoted, what form are you referring to to report capital gains?
Second question is one I've just asked on the thread called 'Reporting US income' of another poster who agrees that CGs belong in line 30. (I'm just asking you also to clarify my understanding). The question is this:
I did not put capital gains on line 30, because the heading of that section is PLUS-VALUES IMPOSABLES EN (cap gains taxable in ). I put CGs in lines 70 under section 7 called REVENUS IMPOSABLES OUVRANT DROIT À UN CRÉDIT D’IMPÔT ÉGAL À L’IMPÔT ÉTRANGER (TAXABLE INCOME ELIGIBLE FOR A TAX CREDIT EQUAL TO FOREIGN TAX). I'm also taking the position of my income being subject to the tax treaty. So do you have thoughts on why line 30 vs. line 70?
Thanks!

 

[Bevdeforges]

"The new Convention preserves the special French tax benefits for U.S. citizens residing in and for French residents who are partners of U.S. partnerships."

I just wonder the date on that "new Convention." As far as I know, the US-French tax treaty was last amended (via a "Protocol") in 2009.

 

[Dunkelcreature]

This is surprising that you don't add these values into section 6. I may be wronf, but here is what I often see as recommendations :

1) The values you place in lines 210 and 221 inform line TS on the 2042. This means it is added to other dividend income you might have in . (careful, if you automate the transfer of this value into the 2042, it will cancel any French sourced dividends...you'll need to add them in manually)
2) Same for interest, placing them in 240 and 251 result sin interest informing line 2TR (french sourced interest income)...

Again, to my knowledge, anything placed into 2TS and 2TR of your 2042 will automatically be taxed unless you add these values into section 6 and have line 8TK completed on the 2042.
Line 8TK in the 2042 is what gives you French tax credit.

To my knowledge, for capital gains and CG distributions they can be placed in line 30 of the 2047 and then also added into part 6 of 2047 to increase the credit in line 8TK. Also complete the form to report capital gains.

Finally, US IRA and pensions go into Part 1 Line 12 (2047) and inform line 1AL in the 2042 to avoid taxation. The amount should also be added into Part 6 to make sure there is no tax.

Also, please note that although you DON'T pay taxes on these amounts, they are reported and will be used to calculate the marginal rate you pay on earned income. They are considered part of your taxable income when calucluating the tax rate. This is why they are reported.

Also, the box 2OP depends on how much of your income is ive (interest/dividend/CG). Placing all ive income into the 30% tax rate may not be beneficial if your total income is in a smaller bracket..but quite beneficial if you are in the highermarginal tax brackets. It is to be calculated and chosen on a case by case basis.

Good luck !

Ok, think I have all of the above items correctly placed. I have a couple of lingering questions from info I've seen from other posts. I don't have a lot of things cross referenced on my 2042c yet, but as I fill out the other forms, things keep appearing, and so do the questions!

1), on form 2047, section 7, chart for line 70 - what about listing cg's again there, and then also listing foreign tax paid there, to then be additionally listed on 2042c, 8VL?

2) on form 2047, line 30 - Listing cg's here shows they also need to be listed again on 2042C section 3, lines 3VG and 3UA. Is that correct? 3VG seems to make sense, but I don't have the kinds of cg for 3UA, so it's just 0.

3) on form 2042c, section 2, line 1AH - does one list foreign source pension here again? (also line RSE there, for source of pension.

I feel like I'm on the home stretch. Thank you so very much to all on this forum with their questions and answers. I still don't know what I don't know!

 

[Tucsonsteve]

This was my intent with the highlight. During a fairly long conversation on the topic, with the local French finance publiques expat expert, last year, he was very clear that US citizenship is a condition necessary to be able to take advantage of the US - treaty. Non US citizens (residents, or else, with US financial interests) - according to him - do not qualify for the treaty provisions. Here is the paragraph referencing such, from the English version of the treaty: "The new Convention preserves the special French tax benefits for U.S. citizens residing in and for French residents who are partners of U.S. partnerships."

In any case - please allow me to apologize for my earlier comment, if it created any confusion. Just scrap it. I think it is better for everybody to the appropriate documents, and also try to validate with impots / finance publiques local services, then fill out the taxes to their level of comfort.

Hi, calin-m:

I appreciate your ing along the expert’s take. I tracked down the quote; it’s from Bill Clinton’s submittal letter to the US senate for the 1994 treaty. It is very clear that it’s not supposed to be an exhaustive description of what the treaty covers and probably was only to note that various benefits of the 1935 treaty were preserved (but not to the exclusion of additional benefits). It’s also not in the treaty itself.

Would you clarify whether the expert who took this position is a public official?

 

[Bevdeforges]

Don't make this more complicated than it needs to be. You may not need that form 2042c at all.

1), on form 2047, section 7, chart for line 70 - what about listing cg's again there, and then also listing foreign tax paid there, to then be additionally listed on 2042c, 8VL?

No. Not if you're talking source capital gains. Check the instructions for form 2047 for the specifics of which capital gains go into which section. But I don't think section 7 is used for US source cg.

2) on form 2047, line 30 - Listing cg's here shows they also need to be listed again on 2042C section 3, lines 3VG and 3UA. Is that correct? 3VG seems to make sense, but I don't have the kinds of cg for 3UA, so it's just 0.

Again, check the instructions for handling cg sourced from the US. (If you have to, the Notice for form 2047 and run it through Google Translate or something similar.) Line 30 is only for capital gains taxable in .

3) on form 2042c, section 2, line 1AH - does one list foreign source pension here again? (also line RSE there, for source of pension.

Again, no. The pensions stuff on 2042c is for Salaries and Pensions exonerated from taxation but declared solely for calculating the effective tax rate. US source pensions go on line 1AL on the regular 2042 form.