FACTA Tax questions.

FATCA is the US law that basically requires foreign banks to report your account information to the IRS (or else). I'm not sure that's the issue here.

I think the issue involves the termination of the tax treaty between the US and Hungary, which will start to affect some taxpayers next year.

Under Article 15(2) of the treaty, US Social Security payments are generally not subject to Hungarian tax. So that exemption will be ending. But whether US Social Security payments will continue to be exempt from Hungarian tax on some other grounds I do not know.

Thanks, Zif.

I did read that US SS wasn't taxed before FACTA but if the HU gov. can figure out a way to tax it, I'm sort of sure they will .

I know I'd rather pay more for my US medicare coverage then just hand over money we already paid taxes on when working in the states.

Really only only perk for us in HU is more afordable health coverage and that's about it.

If we are forced to pay taxes on our US SS then we are better off elsewhere.

Oh well, life is all abut change.

We read something about daul citizens of HU having to pay taxes in HU and any other country they may now be living in?

If so, I'd be the first to renounce citizenship as a dual citizen if I was one.

As Mr. Peabody used to say," Time for this one to go home."

( Have to be over 60 to know who Mr. Peabody was)

    Does anyone know any details on the upcoming FACTA tax for US citizens in Hungary?We plan on going into the Hungarian tax office this upcoming week to see what they know about it and if it applies to our SS income from the USA.If they do decide to tax senior citizens on SS then we are outta here.I know many tax agreements with even between some EU countries will change as of Jan. 2024.Not sure if the new tax laws apply to only dual citizens or if residents also fall under their new ruling.If they do tax US retirement income I'm sure many people will be leaving Hungary.        -@Marilyn Tassy

Formatting of this posting gets lost  - it's a reported bug. The editor removes the blank lines inserted to improve readability.  So I hope it's understandable. I inserted single characters to space it out.

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FACTA is a US based tax information collecting procedure, it's not a tax.

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I hadn't heard of any changes for pensioners.  It would be politically unacceptable.   I did look into it.

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What we are probably talking about is the termination of the DTT (double taxation treaty) with the USA.  This is about the minimum tax for corporations.  HU is at 9% and is the only holdout on minimum corporate tax of 15%.

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So yes, it seems it would be that US pensions look like they would be subject to withholding of about 30% paid if overseas from the USA. It's not really about the HU tax office but they could tax as well, It's mainly about the USA.   Maybe it makes you subject to tax in both countries. Maybe the Embassy is the best port of call or get in contact with your congress(wo)man etc.

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OV has to be absolutely mad to let the DTT expire but then again, it's not good to see the US strong-arming  its allies in this way.   There's still a small amount of time for it to be resolved as it will expire 1st Jan 2024.  If they agree negotiations, they could move it out to 2025 or 2026 to allow time to get it right, i.e. HU election time (haha).  But HU is inconsequential to the majority and the USA.  They  (the USA) holds most of the cards. HU obviously want to keep their tax at 9% to attract investment. Why anyone from the USA would invest here, it's hard to say.  OV is determined to attract Asian firms and people.  It's not like this sort of thing hasn't happened before elsewhere and at other times.

@Marilyn Tassy

FACTA is a form to report all your assets, it wont change  your social security income. its a tool to prevent people not paying taxes on assets they are hiding ( tax fraud)

Its for big fishes

    Its for big fishes         -@angelarobbins

Marilyn mentioned FACTA because of reporting requirements but that was incidental to the real question.

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You need to know about the impending expiry of the DTT (Double Taxation Treaty).   

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USA is ending the DTT with Hungary Jan 1st 2024.

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It will affect any US pension as received in Hungary and may influence your plans.

Social se is already taxed in the US, it wont get taxed again in Hungary if not earned in Hungary.

    Social security is already taxed in the US, it wont get taxed again in Hungary if not earned in Hungary.
   

    -@angelarobbins

If the DTT expires, there will be no credit of taxes paid in the USA against liabilities here. 

Worst case, it means paying again in Hungary.

        Social security is already taxed in the US, it wont get taxed again in Hungary if not earned in Hungary.        -@angelarobbins

If the DTT expires, there will be no credit of taxes paid in the USA against liabilities here. 

Worst case, it means paying again in Hungary.
   

    -@fluffy2560

When we have a free day we will go into the HU IRS office and ask what's up, if they know anything that is.

Double tax would hurt allot of people.

Really at this point in our lives living in HU is just a sort of habit.

I have no emtional ties to living here if they make life harder then it has to be.

We may have to speak with a tax pro at some point .

If we learn anything , I'll share whatever limited info we get.

Thanks everyone for your input!

            Social security is already taxed in the US, it wont get taxed again in Hungary if not earned in Hungary.        -@angelarobbinsIf the DTT expires, there will be no credit of taxes paid in the USA against liabilities here.  Worst case, it means paying again in Hungary.        -@fluffy2560

When we have a free day we will go into the HU IRS office and ask what's up, if they know anything that is.
Double tax would hurt allot of people.
Really at this point in our lives living in HU is just a sort of habit.
I have no emotional ties to living here if they make life harder then it has to be.
We may have to speak with a tax pro at some point .
If we learn anything , I'll share whatever limited info we get.
Thanks everyone for your input!
   

    -@Marilyn Tassy

Thanks Marilyn.   Lots interested to know.

Doesn't affect me as I'm not a USA person.  We get screwed in other ways.

But it's a real change to do away with the DTT.  It's all intended to bring HU to heel. Biden did this unilaterally.  And HU will just have to suck it up.  It's not like there haven't been other times where the USA has come out fighting - remember the head of NAV (Tax Office) being on visa denial list etc?

OV is so belligerent and off the wall right now, he's prepared to sell anyone down the river.   

Maybe he simply doesn't care about anything except himself. Just typical Putinesque and Trumpist thinking.

@Marilyn Tassy

Some two years ago the US made nul and void some agreements between our countries to avoid double taxation.

So it is possible to tax incomes and transfers.