Moving to US (Michigan) from UK
Replies: 11 - Last Post: Jul 30, 2012 6:12 AM Last Post By: SoloHobo
Jul 26, 2012 2:44 AM
Moving to US (Michigan) from UKHi All,
I'm a bit lost with reVgards to procedures I need to explore and what I need to organise before I move to the US. I apprecaite any help you can give.
Single UK citizen.
Visa approved (E1 Treaty Trader). Duration 5 years. Expires in 2017.
Moving to US office, based in Michigan.
Looking to move in next couple of weeks.
Looking to live in Michigan for upto 2 years.
I have an Internationl Drivers Permit, but I understand this will only last one year and I will need to get a Michigan license sometime in the next few months.
My manager is sorting out my accomodation and vehicle.
1: From a tax perpestive I would prefer to be paid US taxes. Are there any forms I need to fill out in the UK prior to the move (P85?)
2: I know I need a social security number. I will organise this when I get to the US.
3: I have roughly a pallets worth of possessions to take to the US. What is the best method? UPS? Do I need a commercial invoice with the goods?
4: US Taxes. I presume this is my responsibility to organise. Any forms I need to fill out prior to the move?
My work is a little niave on this subject, so it is basically upto me to organise. Anything I have missed I would appreciate your assistance on.
Jul 26, 2012 5:40 AM
1There aren't any US forms to fill out as regards taxes prior to the move. Your employer will ask you to fill out a form regarding witholding (PAYE), along with lots of other paperwork during your first day or two,
I don't think you'll have a choice as to what country's taxes you'll pay. I'm pretty sure it will be US (and Michigan) taxes while you are resident here. Unless you move on December 31, the first year's taxes will probably be very complicated.
Jul 26, 2012 6:13 AM
2Welcome to Michigan. I live in Traverse City, Michigan near the beautiful sugar sand beaches of unsalted Lake Micigan.
I really don't feel you will need a IDP. I have helped a couple college exchange students purchase a car here and a IDP was not required. All they needed was a valid drivers liscense from Germany. They got their insurance for the car through State Farm Insurance and it was a very simple porcess. If you will be a Michigan resident, you will have to get a Michigan drivers liscense and that is not an easy process. You will need your passport, visa, drivers liscense and a address here. I would recommend if you do get a car to just register the car and get the plates and use your UK liscense for the first 30 days or so. I think they like you to have a Michigan liscense if you are here for more than 30 days. Here is some more detailed information: http://www.michigan.gov/sos/0,1607,7-127-50050_50417-171810--,00.html
Yes you will need a Social Security number and maybe your employer can help you on that. Here is more information: http://www.socialsecurity.gov/pubs/10096.html
As mentioned above I have helped a number of German students with the purchase of a car, if any questions you are welcome to send me a Private Message on this forum. If their is an interest you might go to Craigs List to see some prices for used cars in the area. http://nmi.craigslist.org/cta/
As for taxes, Michigan has a 6% sales tax and that is collected at the time of sale. Other taxes are taken out of your pay check, and at the end of the year you will have to file State and Federal tax returns
Jul 26, 2012 7:13 AM
3For that income tax set up stuff, you might find it helpful to pay an accountant to help you get started. You need to know how your income is derived. That is, does it come from the UK, are you sort of paying yourself out of a US office, is your US office formally incorporated in the US, and so on. If your pay comes from the US, then you may have issues with what is called "foreign income." It can all get very complicated.
There are businesses that do nothing but income tax--prepare it, file it, give advice. Then there are full-fledged accountants who do all sorts of stuff in addition.
Depending on how your US office is set up, you may have to pay company income tax as well as personal income tax.
If you will be hiring people and doing payroll, you probably need an accountant to help you file all the right paperwork. There are all sorts of payroll taxes that have to be dealt with.
So, my suggestion would be--you are going to need an accountant anyway; you might as well settle that as soon as possible. (Depending on what is being done, some or all of the fees you pay an accountant may be used as a deduction, to reduce your income tax.)
Jul 26, 2012 7:32 PM
4You will need to get a SS# asap once you arrive in the US. With your green card and SS#, you won't have to worry at all about arrangements for taxes. Your employer will set that up for you. Also, if it's a big company you work for, ask them to arrange shipping for your goods, even if it has to be at your own expense. A large company will have cheaper shipping arrangements than than most private citizens could ever negotiate. UPS in any case would not be the cheapest option available.
Hopefully your employer has a US health insurance policy lined up for you. Remember, it's not done through the government here.
Jul 26, 2012 8:00 PM
5You better see a tax professional CPA (Certified Public Accountant) for your taxes, as you most likely will have a income over $21,000 and will may want to file or have to file a Itemized Return, taking advantage of the tax loopholes, if your US Salary is above $75K, it would be very wise. The Tax code is huge, and you need a professional to navigate the IRS rules and Tax Breaks.
E1 and E2 visas are given to individuals from certain countries, who invest substantially in the United States. See Countries List.
Taxation of E1 and E2 visa taxes are mentioned in theIRS Pub 519.
1. They have to meet the substantial Presence Test, and will have to file Form 1040NR or Form 1040, depending on the Substantial Presence Test.
2. They will have to declare their world wide income in the United States Tax Filing.
3. They have the option to choose First Year Choice or file as Dual Status alien, depending upon their non resident tax situation.
4. They have to pay Federal, State, Social Security and Medicare Taxes.
5. If their spouse or children do not have ITIN, they have to get an ITIN by Filing Form W-7 for their tax filing.
Jul 26, 2012 8:22 PM
6U.S. Tax Guide for Aliens Read that and you will definitely want an accountant. Among other things, income tax liability depends on exactly what the treaty between the US & your country says.
You may have to get something called a Tax Identification Number instead of a Social Security Number.
Jul 26, 2012 11:45 PM
Jul 27, 2012 6:43 AM
8If you are a salaried employee and don't make six figures(US) then there is a good chance that you will not have to pay $1000 for an accountant to do your taxes. Self filing the tax forms is not as complicated as it might seem, unless you are a high earner and want the deductions. Then you still might be out of pocket as you will still have to pay the accountant! Speak to your employer for advice on this.
Since you are only staying up to two years, think carefully about shipping stuff. It will easily cost $500 each way and that buys a lot of stuff (and a return airline ticket.) So think about just maxing out your baggage and carry on allowance and buying what you need. Michigan is a LOT colder in winter than anything in the UK, so you will probably buy winter clothes anyway.
Without specifics, it is difficult to give really accurate advice, but you have made a good start.
Jul 27, 2012 6:51 AM
$1000 for an accountant? I have been using an accountant for years in Chicago, and he just raised his fees from $250 to $300. It also tax deductible. You can buy a Software program to, for about the same, $200, but understanding all the details of the tax code is hell. At least for me, as I have real estate, work/entertainment/travel cost, capital gains/losses, and investment income.
In regards to shipping your items, $500 would barely ship one suitcase? I agree its best to ship as little possible, when I moved to Shanghai, I only took my work clothes/suits and finer items, and just bought sportswear items when I was there very cheap. I took 3 bags to China, 1 carry on and checked two big suitcases, which were no fee last year, now they charge $100 per extra bag, under 50KG. I still ended up taking things I didnt need.
There are plenty of good accountants in the Detroit area familiar with foreigner tax filings, as there are so many auto industry related execs based there for 1-3 years at a time from around the world.
The biggest issue for the poster will be finding good housing furnished, in a desirable school district if he has children, without purchasing a home. But, the housing market is so depressed in Detroit, if you do buy, you can get a very nice home in a very good area for a very modest price, under $250K.
Jul 30, 2012 5:54 AM
10We have the name of a CPA in a Detroit suburb who we used on ex-pat tax issue and were very impressed. It is one of her specialties. If you decide to go with an accountant, let me know offline and we can refer you.
Make personal contact with any realtor or lawyer concerning the purchase of property in Detroit. The Nigerians are flooding law firms with phoney cashier's check scams claiming to need their assistance in doing various things (including buying real property) in the Detroit area. Because of this, many people are just thinking "scam" and deleting the emails.
Jul 30, 2012 6:12 AM
11A friend of mine that I met while living in Shanghai is now living in Detroit (Royal Oak) and he and his family is from Brazil, they have enjoyed the transition and even bought a home and qualified for a mortgage no issues. They moved there in Nov of 2011.
I go to Detroit almost monthly for business, and turned them on the a Real Estate Agent that is a old friend there, but post #2 is also in Real Estate in the UP Michigan area, and I am sure can refer to you to a good real estate agent as well. Many of the bigger Real Estate agencies in Detroit, like most major cities, have relocation specialist, and they have everything lined up for a foreigner, CPA, Lawyers, Family Doctors, Housekeepers, gardeners etc, your firm may already be working with a agency.
There are many foreign nationals living in Detroit, from all over the world, working there and raising families.
PM if you need anything, I am pretty connected in Detroit...I live in Chicago.
The commute in Detroit can be a drag, so you might want to live close to work, especially if the burbs...
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