US and Brazil Taxes Revisited

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sjpetzold Active member

Member since 06 October 2021

sjpetzoldActive memberToday 11:32:24

I’m sorry to bring this up again, but with tax season upon us, wise expats’ thoughts turn to the complexities of dual taxes.

My wife and I are both US citizens filing jointly in the US. She is also a Brazil citizen while I have a resident VISA. We are primarily living in Brazil. Most of our income in the US is my retirement pension, Social Security and rental income. Our income in Brazil is a small amount of rental income and an occasional translation job for which my wife is paid.

We have accountants for taxes in both countries but the advice varies widely. For example, I transfer money from my US income into my bank account here for expenses and and have a low-risk investment through my bank for contingencies. All tax professionals, and we, are confused about how this money is taxed.

When I file taxes in the US, I pay on all my US income, but I have to pay taxes again once I send money to Brazil? Is all income in both countries taxable in both countries? And through what method does each country keep tabs on what is being reported to the other country? I have had a tax preparer in Brazil tell me I owed thousands of reais due to taxation on transfers I’ve made (especially through Wise), only to later be told that he was incorrect and I owed very little. Needless to say, I’m really confused and concerned that I get correct advice.

Does anyone have any thoughts or advice on these complex issues? I also need an English speaker to help us navigate, because my Portuguese is still too rudimentary! Thanks in advance, and Happy 2025 to all!

abthree Brazil expert

Member since 28 December 2017

abthreeBrazil expertToday 12:01:22

5966

01/18/25 @sjpetzold. Good morning. You're right, this is a good time to be thinking about this. Unfortunately you're also right, that advice varies widely. I'm sorry that you haven't found a Brazilian tax advisor that you can trust. I think that the most important thing if you can't find one who knows everything (because who does?) is to find one who works to answer questions and to learn things that s/he is not familiar with, rather than making assumptions. In the end you'll be dependent on this person, so keep good records of all your discussions.

My latest input on this topic appears in Post #5 in this thread:

https://www.expat.com/forum/viewtopic.p … 24#6011885

I handle my US finances similar to the way that you do, except for filing status because our situations are a little different there. My Brazilian taxes on my US income were about 40% of my US taxes last year, a little higher than previous years but still in the same range. As always, that's not advice, just another data point for you. All the best!

roddiesho Serial expat

Member since 10 November 2022

roddieshoSerial expatToday 15:05:13

827

@sjpetzold Good Luck! I think you are on the right track. I have my U.S. money deposited into PayPal. When I withdraw money, it is through the Red ATM machines at the Supermercados which convert the American dollars into reals. No taxes have been paid through that method...though if I am wrong, I will need a Brazilian Safe House after tax season, 😐

Roddie in Retirement🕵

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