I'll have to look into this as I expect to receive dividends in the long term. How much do you think I can save if I submit a1040nr?
Nowadays I don't visit the USA. Is there a way to file a 1040NR without going to the USA?
Yes, very possible. U have to engage an accountant in the US to do this for you. Usually it helps to set all these things up when you are in the US.
I will give you an example that I am familiar with. If you remember going back more then 20 years, there have been property trade shows in Singapore marketing US and Canada properties. Many sinkies including yours truly bought some thing there. For those who own properties in these countries, the govt also withholds tax on the rental income. 25% for Canada and 30% for US. But my property manager there will forward all the withholding amounts to the govt every month, and then at year end he will send all the profit and loss statement to my accountant. My accountant prepares the tax filing, and emails it to me. i sign off on the return and email it back to him and he files for me with the relevant tax authorities. Normally, the accountant will deduct all the expenses like property tax, maintenance expenses, management fee, banking fee, accountant fee, strata fee etc. He will arrive at a net income amount. Most of the time, the taxes owing on this net income is less then what was already given for withholding. hence, the govt. sends you a refund. If you also have dividend income, you can also send all that to the same accountant. You should make a one time visit to the US to set up your bank account there, and also interview accountants with such experience in filing for international clients. I normally use HSBC as my bank there because they have branches here and makes any funds transfer or top up easier. the large accounting firms usually have some chinese accountants that know about non resident tax filings. I think you are supposed to file a tax return in the US anyway, regardless of whether you have any refund coming back for your withholding. Don't forget to ask the accountant what they charge. Sometimes, any potential refund you might get back from the IRS is less then what you paid the accountant to file for you. LOL.
How much you save depends on how much is your dividend income. Lets say your dividend income is $90,000 USD, (I used $90,000 because any higher and a much higher rate of taxes gets levied.) and you already paid $27,000 USD taxes (30% withholding taxes). Under the single tax filing, your US taxes for an individual should be $5156.25 + 25% of any amount over $37,450. In this case, your $90,000 income should have taxes of $18,293.75. So, you should have received a refund of $27,000 - $18293.75 = USD$8,706.25. I am just using this as a simplistic example, and of course, always consult an accountant. Hope it makes sense.
