Leaving on a jet plane - close accounts?

October 15, 2006 4:34 AM

Permanently leaving the U.S. to go back to Europe - do I have to close my bank account and credit cards?

With the dollar being so weak I'd like to transfer/exchange my money some time later. But would the IRS want me to keep paying taxes in the U.S. for income from interest (however small)? Is it even legal to keep an account while being neither a citizen nor a resident?

posted by meijusa to Law & Government (13 answers total)

Best answer: If you are a non-resident, non-citizen, income from a US bank account is not taxable. It is perfectly legal to keep a bank account. Just make sure your bank knows your new address.
posted by TheRaven at 5:18 AM on October 15, 2006

Best answer: You will have to fill out a form indicating your nonresident status to avoid being taxed (the bank might even send it to you).
posted by Krrrlson at 6:26 AM on October 15, 2006

If you're not going to use them it's probably a good idea to close 'em for security purposes.
posted by Anonymous at 7:00 AM on October 15, 2006

But the security benefit of closing the accounts has to be weighed against the $$ benefit of wating for the exchange rate to improve. This is, of course, assuming it does improve. I remember when the Euro was released and it was slightly weak against the dollar... soon it was stronger. A Euro has now equaled roughly $1.20 for at least a couple years...
posted by lorimer at 7:57 AM on October 15, 2006

maybe there are european banks that provide the possibility of accounts in dollars.
posted by jouke at 8:50 AM on October 15, 2006

If I were you I would hang on to them, just for the flexibility and choice.
posted by Meatbomb at 9:12 AM on October 15, 2006

The answer is "No, you don't have to close them." Interest less than $400 per year is basically zero - the IRS will not come after you.
posted by jellicle at 11:00 AM on October 15, 2006

Best answer: keep them, keep them, keep them. i also live in europe (still a usa citizen), but i hold my USA bank accounts, credit cards, and misc accounts. i wanted to close them all out (for the sake of ease, finality, security, etc) but i am so thankful that i didn't.

the reason to keep them is that there are still many times when using an american credit card is invaluable, especially with online purchases. some vendors won't even accept a non-us credit card. also, after almost one year into living in europe, there are still unexpected bills that come my way from the usa that need to be paid. also, you can easily do all pf your transfers, banking, and bill-pay online, so it is no problem at all to hold onto your usa accounts.

also, i don't know what country in europe you are moving to, but there are always a few months-worth of paperwork and other such nonsense to take care of BEFORE you can open a european bank account. you need resident papers, visas, etc...so you definitely will need to use your american credit cards (hence your bank accounts to pay your CC balance) for the first few months. for the love of god, keep your us accounts open!
posted by naxosaxur at 11:13 AM on October 15, 2006

The only thing I would recommend is also getting a local bank account, because for some things -- eBay for example -- I think you can't set up a verified European shipping address if the billing address is in the States. Also, this way obviously you can transfer money locally and save having to pay for overseas ATM withdrawals. I'd just like to point out, however, that due to the fact that ATMs in the UK can't charge you for using their machine, it's actually cheaper take out money any bank in London than from most ATMs in the US. Not sure if this applies elsewhere in Europe.
posted by Deathalicious at 1:27 PM on October 15, 2006

Response by poster: thank you all!
posted by meijusa at 2:08 PM on October 15, 2006

You may want to get the credit limit on your US credit cards reduced, for security reasons.
posted by blue_beetle at 4:54 PM on October 15, 2006

I definitely second naxosaxur's advice -- opening new accounts in a new country can be a pain in the arse if you don't have an alternative to carry you over in the mean time.

You might also need to change your mefi username ;)
posted by teem at 9:03 PM on October 15, 2006

Naxosaxur is right about some venders not accepting non-American credit cards. However, this is against Visa and Mastercard guidelines, and should always be reported. I learned this by complaining to Visa, who advertises how their card is so accepted.
posted by Goofyy at 11:51 PM on October 15, 2006