Tax Free Extraction of US Pensions

Attorneys for Tax-Free Extraction of U.S. Pensions

Do You Need Help Getting the Most out of Your Retirement Funds?

Let’s get straight to the point: If your country of current or planned residence is listed below, then you can withdrawal your entire U.S.-based retirement plan with 0% tax owed to the IRS. Even if your country is not listed, it may be beneficial to engage us for tax residence planning. Read the full details below.

  • Armenia
  • Australia
  • Austria
  • Azerbaijan
  • Bangladesh
  • Barbados
  • Belarus
  • Belgium
  • Bulgaria
  • Canada*
  • China
  • Croatia*
  • Cyprus
  • Czech Republic
  • Egypt
  • Estonia
  • Finland
  • Georgia
  • Germany
  • Greece
  • Hungary
  • Iceland
  • India
  • Ireland
  • Israel
  • Italy
  • Jamaica
  • Japan
  • Kazakhstan
  • Kyrgyzstan
  • Latvia
  • Lithuania
  • Luxembourg
  • Mexico
  • Moldova
  • Morocco
  • Netherlands
  • New Zealand
  • Norway
  • Pakistan
  • Philippines
  • Romania
  • Russia
  • Slovakia
  • Slovenia
  • South Korea
  • Spain
  • Sri Lanka
  • Sweden
  • Switzerland
  • Tajikistan
  • Thailand
  • Trinidad & Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Ukraine
  • United Kingdom
  • Uzbekistan
  • Venezuela

*Tax is reduced, but not eliminated.

Generally, when you withdraw funds from a U.S.-based retirement fund – such as a 401(k), 403(b), Individual Retirement Accounts (IRAs), and even an executive Non-Qualified Deferred Compensation (NQDC) Plan – there’s a 20% withholding tax. In addition to that, if you’re under the age of 59 and six months at the time of the withdrawal, there’s an additional 10% early withdrawal penalty, which is designed to discourage people from withdrawing funds prior to retirement age. For nonresident non-U.S. citizens, there’s a gross-basis 30% withholding tax. In just about any scenario, you’d be looking at losing 30% (nearly one-third) to the IRS.

As long as you’re not a U.S. citizen, attorneys for tax-free extraction of U.S. pensions from Castro & Co. can get your effective income tax rate down to 0% in both the U.S. and your country of residence.

In the absence of planning, an individual will pay 30% tax to the U.S. Although your country of residence will likely grant you a tax credit for the 30% paid to the IRS, you could end up owing additional tax in your effective income tax rate in your country of residence is greater than 30%. For example, let’s say you’re an Australian tax resident with an effective Australian income tax rate of 35%. Although you would get credit for the 30% paid to the IRS, you may still owe an additional 5% to Australia without proper planning.

Want to Know More?

For a more in-depth explanation, please watch this video of our Managing Partner explaining Tax Free Extractions of U.S. Retirement Plans.

Our Process

Contact & Engagement

Get in contact with us! Schedule a day and time for a free consultation with one of our top tax attorneys. Afterwards, we'll get your online file-sharing portal set up. This allows for us to view your documents over a secure cloud network. No need to mail or fax documents. Once the engagement letter is on file, we move on to the next step.

Preparation & Conference Call

Once your engagement letter has been signed, we will prepare and submit all of the necessary documentation. Afterwards, a joint conference call with yourself, our tax attorney, and the financial institution will be conducted.

Extraction & Tax Return

After a completed conference call with the financial institution, our tax planning attorneys will be able to fully extract your U.S. pension, tax free. After 5-7 business days, the funds will either be deposited into a financial institution of your choice, or a check will be sent out to an address you provide. Afterwards, we will need to file your next tax return including the treaty position disclosure. Without this, you risk the IRS imposing penalties, so it's best for us to handle this.

Our Other Services
  • Offshore Tax Compliance
    Tax planning for individuals with offshore accounts in other countries. (FATCA).
  • Exit Tax Planning
    Before departing the U.S. it is important to know how you will be taxed upon leaving. Exit tax planning is crucial.
  • Pre-Residency Tax Planning
    Before moving to the U.S. make sure that you have all your financial affairs in order. We can help with this process as well.
  • Inheritance Tax Planning
    Received an inheritance? Our tax attorneys will help structure a tax efficient strategy that works for you.
  • Estate Planning
    Domestic & International trusts, assistance with life planning documents and services for businesses, which include customized retirement plans.
  • AMT Tax Planning
    Our tax attorneys will help reduce the odds that you'll owe the AMT through proper tax planning.
  • ABC News
  • CBS News
  • U.S. News & World Report
  • The Wall Street Journal
  • International Bar Association
  • Bloomberg Business
  • SMSF Adviser
  • The Sydney Morning Herald
  • Tax Analysts
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