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Merlo
Merlo, Accountant
Category: Tax
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Experience:  25+ years tax consulting. Specializing in returns for US citizens living abroad
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I am moving back to the Netherlands, where my family lives. I

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I am moving back to the Netherlands, where my family lives.
I am 76 years old.
Can I cash my IRA in to take with me. And if so do I still have to pay a penalty.
Gesina Schutten

Hello Gesina,

 

No penalty would apply to withdrawals made from your IRA since you are over the age of 59-1/2. However, regular income taxes will still apply to any withdrawals made from this account, regardless of where you live at the time the withdrawal is made.

 

The actual percentage of tax that you would pay depends on your other income for the year and your filing status, as this is treated as ordinary income and will be taxed at whatever tax bracket applies to you for the year.

 

 

Thank you Gesina

 

 

 

Customer: replied 6 years ago.

How much money can I take with me.

I have not paid taxes in many years since my income bracket is too low.

I need to rent a home etc.

 

Hello again Gesina,

 

You can take as much money with you as you want to. Taking the money out of this country is not what creates the taxable event. The taxable event occurs when you withdraw the funds from the IRA account.

 

If you are a single taxpayer with no dependents other than yourself, then your first $9,350 in regular earnings would not be taxable. Any income you have over that amount, including your IRA withdrawals, will be subject to tax in the year the withdrawal is made. Once you withdraw the money and pay the taxes, you can take as much as you wish with you to the new country without further tax consequences.

 

 

Thank you Gesina

 

 

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