Opening an IRA with an HK Address (for U.S. Citizens)

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  1. #1

    Join Date
    Feb 2012
    Location
    Park Island, Hong Kong
    Posts
    166

    Opening an IRA with an HK Address (for U.S. Citizens)

    I’ve read many articles about contributing to an IRA while living abroad, but I haven’t seen one article mention any specific company that allows a U.S. citizen abroad to open an IRA while living and working abroad for a non-U.S. entity. With Schwab you could select retired, not employed, homemaker, or student and then not need to enter your foreign employer’s information, but otherwise I don’t see a way.
    Can you name a company that is willing to let U.S. citizens living and working abroad open an IRA with a foreign address and a foreign employer?

    Interactive Brokers' IRA website says "Residents of Hong Kong may not open Individual Retirement Accounts."

    Schwab redirects you to their international page if you select that you have a foreign address, and I don't see any mention about IRAs on their international site.

    Vanguard requires you to enter a U.S. address if you select that you are employed or self-employed in order to open an IRA with them.

    I'll probably use Schwab because they're great, but I'd like to know if anyone knows of a company that lets U.S. Citizens working in Hong Kong open an IRA using their HK address.

  2. #2

    Join Date
    Feb 2012
    Location
    Park Island, Hong Kong
    Posts
    166

    In related news, I never knew a U.S. citizen married to a nonresident alien (the IRS' term not mine) can choose to file as Head of Household if that U.S. citizen has a dependent (not their non-resident alien spouse). But this option is stated on the IRS' own website - https://www.irs.gov/individuals/inte...d-of-household

    This is related in the sense that it affects Roth IRA contribution limits. If you file as married filing separately (what I've been doing for a while) then if your MAGI is greater than 10,000USD then you can't contribute to a Roth IRA if you lived with your spouse at any time during the year. However, if you file as Head of Household then your MAGI can be up to 122,000USD.

    In 2019, after exhausting the FEIE I have just a bit left of unexcluded income, which is the amount I can use to contribute to a Roth IRA up until July 15th, 2020. I guess it's a narrow range, but it applies to some people and filing as Head of Household has potentially other tax benefits, which I haven't explored yet.

    If you read enough IRS documentation, you're bound to learn something or potentially go insane.


  3. #3

    Join Date
    Feb 2012
    Location
    Park Island, Hong Kong
    Posts
    166

    I've now looked at Wealthfront and their site says "We cannot support clients residing outside of the U.S., including U.S. citizens residing abroad."

    Betterment seemed to care the least amount, but they still say "The products and services provided under the Program by Betterment, Betterment Securities, and the Website are not being offered to, and are generally not available to, anyone located outside the 50 U.S. states, including U.S. citizens residing or working abroad." However, this seems to be more from a standpoint of limiting their legal liability not that they don't want to work with U.S. citizens residing and/or working abroad.

    In conclusion, I can't find one large reputable financial institution that is happy to open an IRA account for a U.S. citizen living and/or working abroad. Many say it's related to the Patriot Act or some other regulations. That's fine, but at least according to the IRS, U.S. citizens abroad can contribute to an IRA if they meet the IRS' requirements, so all the above is annoying.


  4. #4

    Join Date
    Aug 2006
    Posts
    222

    This may not be helpful, but providing just in case.

    I used to have a traditional (not Roth) IRA with Morgan Stanley. They decided I was not rich enough to keep as an overseas client so effectively forced me to move the iRA to a different firm.

    I moved it to Vanguard. This technically involved opening a traditional IRA account with them while I lived in HK. However, I already had a mutual fund investment account with Vanguard, so they were able - eventually - to permit this transfer with the proviso that the new IRA account could also only invest in mutual funds as I did not already have a stock account with Vanguard and they were not willing to open any new form of investment vehicle focus for me.

    So if you already have some kind of account with a firm in the US, they might be willing to let you open an IRA as well.

    Good luck!