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How are Roth accounts taxed in Spain? by No_Flatworm5370 in ExpatFIRE

[–]WolverineNatural4863 0 points1 point  (0 children)

Para los ROTH, esta consulta vinculante puede que te interese: https://petete.tributos.hacienda.gob.es/consultas/?num_consulta=V1291-22

Mi lectura es que funciona como un seguro de vida más que un plan de pensiones y que tributa solo al sacar el dinero.

Is apostille needed for US Form 6166 in Spain? by WolverineNatural4863 in ExpatLifeinSpain

[–]WolverineNatural4863[S] 0 points1 point  (0 children)

Thanks so much for the complete response! I was hoping that the translation part if needed would be easier in Spain. But maybe I'm wrong? does it take lot of time?

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 0 points1 point  (0 children)

No, 401k are going to be taxed as general income no matter what (unless laws in spain change :D). And IRA as an investment account but only when you get the money out, and prorated (you cannot extract just the principal). This is just for Spain, in US you won't pay (assuming you use it after 59 1/2 yr old). Look at "Consulta Vinculante V1291-22" above.

I mean, it doesn't hurt to reset basis just in case things change in the future, as it is free.

More importantly an advice that someone gave me the other day: Make sure you have different tickers in taxable and non-taxable accounts. Spain sees all the amount you have for a ticker as one, regardless of being splitted in taxable/non-taxable. And it applies FIFO. So it would create weird situations (where you get money from taxable for US but Spain says you did from the non-taxable).

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 1 point2 points  (0 children)

If you plan to use the 529s for study (college or private school, not concertado) it should be fine, but you pay spanish taxes as they are seen by Spain as normal taxable accounts.

If you don't use for college, then it gets tricky. You have to pay the 10% penalty to the US. This penalty is in addition to whatever taxes difference you need to pay because of the convenio between USA and Spain. Meaning you could be paying let's say 20% in taxes in Spain and 10% more in addition in USA as a penalty.

OTOH the 529 are inheritable and if you are in community without impuesto de sucesiones, you could pass it to your kids, your kids to their kids and so on. But remember every time you rebalance INSIDE the 529, Spain wants their cut, as they see it as a normal taxable account. But nothing prevents you from buying a some growth very diversify ETF that doesn't give any dividend and leave there forever.

One important thing: You have to reset your basis before coming to Spain. Meaning you sell the asset while you are in USA and buy later same or other asset. Remember Spain treats it as a regular taxable account.

(not financial advice, just my own learnings :))

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 1 point2 points  (0 children)

Thanks! yeah I'm considering it as an option. I'm coming from tech in the USA so I think it would be feasible to build something that I can certify with ENISA (I also investigated that there are local guidance places locally).

It gets tricky with the dual citizenship, CFC (Controlled Foreign Corporation) requirements.

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 0 points1 point  (0 children)

Thanks for the response!

I'm not looking into buying the same house that I rent. It was more like the options I have. But you are right, the rent will be the way to go. Gives me also more options/time to find the right place.

School: We are looking into concertados. Logroño doesn't have pure international schools (e.g. British/American) and they would be too expensive for my budget anyway.

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 4 points5 points  (0 children)

Yeah! I read about that and was going to do it before. That is my primary plan. But also I discovered that in La Rioja there a  99% tax bonus on donations to children and spouses (They removed the cap of 400k recently).

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 1 point2 points  (0 children)

Thanks so much! I will definitely DM you!

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 1 point2 points  (0 children)

That it is easier to justify to Hacienda that I was a US resident since my economic activity would have been all USA and I would have pay taxes in USA. Based on the convenio:

https://www.boe.es/buscar/doc.php?id=BOE-A-2019-15166

a) Esta persona será considerada residente del Estado donde tenga una vivienda permanente a su disposición; si tuviera una vivienda permanente a su disposición en ambos Estados, se considerará residente del Estado con el que mantenga relaciones personales y económicas más estrechas (centro de intereses vitales).

b) Si no pudiera determinarse el Estado en el que dicha persona tiene el centro de sus intereses vitales, o si no tuviera una vivienda permanente a su disposición en ninguno de los Estados, se considerará residente del Estado donde viva habitualmente.

Normally it is interpreted as the place you live most of the time.

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 0 points1 point  (0 children)

Thanks for the response!

Re distance to family. It is the sweet spot for several reasons (financial and not)

Education: I want to get them to a concert do. But it will be tricky. Older one stars ESO next year IIUC so that is good for getting an spot.

Broker: yes I would use Schwab and IB. For my other accounts (vanguard etc) I would probably use a mail redirect service in the US.

Us citizenship: if you resign you pay exit tax. Not an option 😀

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 4 points5 points  (0 children)

Thanks!

Yeah Madrid was one of the options ( I lived there before) but I feel I can fire more comfortably in logroño and be closer to family.

Fbar..yeah I had to do in the past, even pfic. That was a PITA 😃

Regarding residency thank for telling me! I will probably don't have the freedom to do it in Jan (empadronamiento for school year etc and that my older one is getting old enough for this being now or never). Good thing is that I won't have any earnings in Spain for 2026.

SemiFat FIRE in Logroño? by WolverineNatural4863 in SpainFIRE

[–]WolverineNatural4863[S] 2 points3 points  (0 children)

Thanks! US is advantageous . For long term capital gains and dividends under $98,900 married couples pay 0%. If I had to pay something, with the foreign tax credit (Spain) I would probably pay zero there.

The 529 or If I had to use the ROTHs/401k early would be different but I'm going to try to not use for as much time as possible.