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Reporting MPF for US Taxes

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  1. #1

    Join Date
    Aug 2021
    Posts
    20

    Reporting MPF for US Taxes

    Hi,

    Does anyone know how MPF should be reported for US personal taxes? I just moved to Hong Kong late last year and have a MPF account through the company. The account only has a few thousand HKD in it. Does anyone know what forms I would need to fill out when filing for my US taxes? Is MPF a PFIC?

    Many Thanks!


  2. #2

    Join Date
    Feb 2012
    Posts
    411

    You can check out my lengthy post at https://geoexpat.com/forum/175/threa...ml#post3818428

    There are plenty of other threads on this site about MPF and US taxes too, but with unfortunately different opinions.


  3. #3

    Hi Kkdo,

    Welcome to the world of FBAR and Foreign Income Exclusion, bro. I had a consultation with Fergus Tong of USAsia Tax early March- He emailed a Tax planner with a large number of Tax forms to fill out beforehand, some of which were not pertinent to me, i.e. 'Sales of Stocks and Securities.'
    Anyhow, he stated that with the FBAR, along with our HK bank account, we also need to state our MPF account. I use Prudential Financial, so Fergus suggested I wait until PF sends the Annual statement around latter April. For FBAR, we get an automatic 6-month extension from April 18th, so not fretting.
    As far as the Foreign Income Exclusion- that doesn't Kick in until August, so Mr. Tong planned to get an Extension for me so that the FIE can be activated. Basically, I owe no tax for Tax year 2021 due to it. I spent Tons of time gathering documents and calculating Medical and dental expenses, including those of my mother, travel expenses, etc., but the upshot was that Fergus simply told me that FIE would exempt me from tax, so all those expenses calculation was moot.
    Anyways, I decided to leave 1040, 2555(FIE) to Fergus. We can file FBAR online by mid-October- straightforward stuff- just basic Bank account info and basic MPF account info and some general info- I already printed out a PDF file of it. Peace of mind- now back to other responsibilities, work, caring duties and my Masters degree course....


  4. #4

    Hi Kkdo and Logan,

    On a similar note- I'm just wondering whether you guys personally any Green card holders in HK, if I may ask? I got my GC just last August through the Diversity visa(no, I'm not joking). Anyways, GC holders need to return back to the US within 364 days or lose their status. The thing is, due in part to my caring duties for my mother, it's unlikely I will move to the US by this Aug. and I very highly doubt I'm a candidate for the SB-1(Returning resident visa). Apparently, even absences between 6 months-1year may raise eyebrows of U.S. border officers at airport Point of Entry. And there is no way on God's Green Earth that I will ever do the whole Q-Hotel, Covid test after test after test just to preserve my GC status by flying to US for a few days in August- not even to say how Airport border officers would react. Don't feel it's worthwhile at all paying $6,000 /hr for a consult with Eugene Chow or another US immigration attorney- the 364 day law is cut and dry, set in stone.


  5. #5

    Join Date
    Aug 2021
    Posts
    20
    Quote Originally Posted by johnlang11:
    Hi Kkdo,

    Welcome to the world of FBAR and Foreign Income Exclusion, bro. I had a consultation with Fergus Tong of USAsia Tax early March- He emailed a Tax planner with a large number of Tax forms to fill out beforehand, some of which were not pertinent to me, i.e. 'Sales of Stocks and Securities.'
    Anyhow, he stated that with the FBAR, along with our HK bank account, we also need to state our MPF account. I use Prudential Financial, so Fergus suggested I wait until PF sends the Annual statement around latter April. For FBAR, we get an automatic 6-month extension from April 18th, so not fretting.
    As far as the Foreign Income Exclusion- that doesn't Kick in until August, so Mr. Tong planned to get an Extension for me so that the FIE can be activated. Basically, I owe no tax for Tax year 2021 due to it. I spent Tons of time gathering documents and calculating Medical and dental expenses, including those of my mother, travel expenses, etc., but the upshot was that Fergus simply told me that FIE would exempt me from tax, so all those expenses calculation was moot.
    Anyways, I decided to leave 1040, 2555(FIE) to Fergus. We can file FBAR online by mid-October- straightforward stuff- just basic Bank account info and basic MPF account info and some general info- I already printed out a PDF file of it. Peace of mind- now back to other responsibilities, work, caring duties and my Masters degree course....
    Thanks John for the info!! I thought the FIE is only applicable to people that didn’t spent more than 35 days in the US for a given tax year? For the MPF reporting, would you need to also fill out Form 8938 (FATCA) and Form 8621 (PFIC)?

  6. #6

    Join Date
    Aug 2006
    Posts
    335
    Quote Originally Posted by kkdo:
    Thanks John for the info!! I thought the FIE is only applicable to people that didn’t spent more than 35 days in the US for a given tax year? For the MPF reporting, would you need to also fill out Form 8938 (FATCA) and Form 8621 (PFIC)?
    Check form 2555 for FIE instructions. You can establish either by physical presence test (those days you mention) or as a bona fide residence bfr. The latter has no day limits unless you spend too many in the USA, I believe.

    Form 8938 needed for FATCA, if living abroad and you have US$200,000 overseas. ($400k if married filing jointly). See https://www.irs.gov/businesses/corpo...r-us-taxpayers

    I've never had to file form 8621 - not rich enough or circumstances not complex enough.

    And don't forget the FBAR, which is not filed with taxes but is a separate requirement.

    Have fun!

  7. #7

    Spode nailed it as far as FACTA- a simple search would find out the criteria for that. Yes, you're correct about the FIE requirement. As far as 8261- my tax accountant did not mention anything about it, so irrelevant to the MPF.

    The Form 1116- Foreign Tax Credit may be one that you could implement- although we only get our HK IRD- IR56B form around late March. Also, as you're a HK newbie, I'm not sure how much you could claim for the 2021 tax year. I think your best bet may be contact a US tax accountant here HK for more guidance.

    Although, I presume you have filed 1040 and Schedule A year-in-year- out so likely 2nd nature for you? Mr. Fergus Tong requires an initial $5,000 payment, and then roughly another $5,000 when the tax is eventually filed. We file the FBAR ourselves, as it is done online and pretty straightforward. He still offers face-to-face consults up to now.

    One annoying thing is due to likely postal service issues, the original tax planner he sent to my home address was lost in translation and I had to print out the Excel based documents that he sent by email. Good luck.


  8. #8

    Hi Logan,
    Just a side thought- you mentioned that you don't believe that tax professionals are needed for something straightforward, but it seems your US tax situation seems rather complex! Perhaps you're a Finance expert yourself. Also, when that 'Confused USA guy' starts asking questions like whether a HK MPF Voluntary Contribution(!) would be considered a ' US Trust'- we know he's getting Way over his head.


  9. #9

    Join Date
    Feb 2012
    Posts
    411
    Quote Originally Posted by johnlang11:
    Hi Logan,
    Just a side thought- you mentioned that you don't believe that tax professionals are needed for something straightforward, but it seems your US tax situation seems rather complex! Perhaps you're a Finance expert yourself
    You've misquoted me. It's best to quote someone. I didn't say I think "don't believe that tax professionals are needed for something straightforward" I said they shouldn't be required and filling taxes should be straightforward. I shared my dreams and beliefs.

    I hate paying for things I don't think I should pay for. HK taxes are amazingly simple and there are so many better ways to tax citizens than what the US drags people through.

    Anyway I wish everyone the best at figuring out what works for them. I'm adamant to do my US taxes myself, but to each their own.
    shri likes this.

  10. #10
    Quote Originally Posted by johnlang11:
    Hi Logan,
    Just a side thought- you mentioned that you don't believe that tax professionals are needed for something straightforward, but it seems your US tax situation seems rather complex! Perhaps you're a Finance expert yourself. Also, when that 'Confused USA guy' starts asking questions like whether a HK MPF Voluntary Contribution(!) would be considered a ' US Trust'- we know he's getting Way over his head.

    I'm so far over my head on this topic that the Deepsea Rolex I can't afford (due to US tax!) stopped working.

    That said, the IRS actually issued clarity on the subject of foreign retirement accounts being trusts, and they're not. The document of course has significant ambiguity, is 10x longer than needed, and has many things to confuse you but by American tax standards it's pretty good.

    https://www.irs.gov/pub/irs-drop/rp-20-17.pdf?noembed
    Last edited by shri; 04-05-2022 at 05:21 PM.