hello, my mother (Japanese citizen) is getting ready for retirement in about a year but she has spent her whole working life in the United States. This means she has a full US private pension and full benefit social security. She plans on staying in Japan for her golden years but I had some tax questions that we have had trouble finding the answers to. I was hoping English speakers actually living in Japan could give us a hand, point us to the right direction, or perhaps had a professional international tax firm they recommend that could help as I would say she is more American than japanese.
- She is not a US citizen so are we correct in assuming she doesn’t pay US taxes even if she is paid in dollars and leaves it in her US account? Furthermore, if we stay below a certain threshold for her monthly payments and bring them into Japan then she is taxed at just 5% because in Japan pensions are considered “miscellaneous income”? or is the full pension taxed at the higher 45% rate at once like a huge painful bandaid because it exceeds 4senman? Probably not but might as well ask xD
- she would like to buy a condo or house instead of renting so does transferring over a lump sum to pay for property taxed (say 2-3senman)? Would a loan be better and pay off monthly?
- she is also given a large lump sum the day of retirement when she leaves the US, (say August). She wants to travel before settling down so If she stays in Japan for less than 6 months of the tax year so (August to January 1) does that mean she isn’t taxed on that lump sum? I assume tax season in Japan is the first of the year so her being in Japan for only four months means she is in some sort of tax limbo? From Jan 1-July 1 she will be staying in Japan so naturally she will pay monthly taxes and any annual 2027 taxes
hope this is the right place to ask as her situation is a bit unique I think. Any help would be greatly appreciated thank you very much. I can add any details, I’m just trying to help her not mess up her retirement.
by AcrobaticWar1