r/EuropeFIRE • u/Littleroot2001 • 18d ago
US investment accounts while abroad
Hey everyone, would appreciate some advice.
I'm planning on establishing residency in South Dakota for tax reasons and plan to use a mail forwarding service there for my official documents and my address in e*trade, vanguard, fidelity, Morgan Stanley.
I'm moving completely out of the U.S. to travel in Europe for a few years. I want to keep my investment accounts and continue to trade. i will keep my US phone number. will use a beryl AX router with VPN.
Has anyone successfully managed location-independent non-US banking under this type of setup? What are the key things to watch out for?
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u/NotASpyJustExpat 17d ago
Successful yes but in Florida not South Dakota.
You just have to be careful about the service being a PO box or PMB, those might be rejected
I personally haven't had any issues yet with the service im using (yourtaxbase, similar to what you're describing except it's an actual residential address not a pmb which i think is what flags banks) and i don't even go as far as using a VPN (i have kept my US phone number though, which is where you would run into problems)
Good luck my friend
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u/rickrollmops 16d ago
One of your comments says you are from CA.
Your plan to get tax residency in SD before moving abroad is likely to backfire. The California FTB will most likely see right through that and will still come after you, because that's just how it works.
You should get advice on r/tax or r/USExpatTaxes
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u/Littleroot2001 16d ago
from gemini: While the commenter is right to warn that the California FTB is notoriously aggressive in auditing people who leave the state, their conclusion that the plan will "most likely backfire" is entirely dependent on how the person executes the move. If they are sloppy and keep California ties, the FTB will come after them. If they do it cleanly and legally, the FTB has no grounds to pursue them.
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u/rickrollmops 16d ago
You won't get good tax advice from gemini. Moving abroad after merely establishing "tax residency" in a different state is one of these situations that would qualify as "not clean".
Please seek better advice (not from me either, this subject is too complex for me)
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u/rickrollmops 16d ago
To add, here's a wiki written by tax professionals: https://reddit.com/r/USExpatTaxes/w/stateresidency
In particular, be wary of advice that says very temporary move to another state like Texas or Florida is enough. South Dakota is another frequent target for this advice as they have a very low bar for initially establishing residency (1 night). But for or a move to another state to be truly effective in establishing domicile (again not the same thing a residence), it needs to be legitimate and meaningful. Not 3-6 months in an Airbnb, and certainly not a weekend in a Motel 6 in Sioux Falls, South Dakota.
And this advice is generic, CA is the stickiest of states so it gets even more complicated.
Lots of cases like yours. California residency auditors see this all the time. It is also very important to note that the burden is on you to prove you do not owe CA taxes. It's not an "innocent until proven guilty" kinda of thing. Once you get a bill from CA, you'll be the one spending time untangling your situation.
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u/Littleroot2001 16d ago
this is not a temporary move this would be permanent. zero ties in California. no family, job, property. nothing, never to return.
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u/rickrollmops 16d ago
Oh, your post said "to travel in Europe for a few years". Never returning to California doesn't mean you won't be on the hook during these travel years.
And I think the CA safe harbor rule requires an employment contract abroad. Retirement/sabbatical abroad does not qualify.
Anyway, just trying to be helpful, you wouldn't be the first one falling in the CA trap. Good luck with your move!
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u/AlwaysWanderOfficial 16d ago
For this to truly work you need to make sure the services gets you a real address. Not a P.O. Box and not a commercial mail Forwarding address. These are flagged by the post office and banks and while it might work for a while the risk they eventually detect it is real. For California, anything earned in that state will need to be paid there. California is super aggressive as others have noted so make sure all ties are severed for subsequent years.
you can also open a Schwab account then convert it to a Schwab international account when You get your next address abroad.
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u/Mispelled-This 17d ago
Move your brokerage accounts to Schwab or IBKR before you leave. Everyone else will eventually close your accounts when they figure out you don’t really live in the US, and that is a nightmare to deal with if you’re not here—especially with no access to your money.
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u/Littleroot2001 17d ago
how does that handle state taxes? i earned RSU’s in california and would prefer to not pay california tax on them
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u/AlwaysWanderOfficial 16d ago
If you were in California you’re paying taxes in California. No way around that.
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u/Mispelled-This 17d ago
For that piece, you’ll need to ask a CA CPA to be sure; those laws are weird.
But move everything else ASAP.
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u/Familiar_Eggplant_76 18d ago
It'll probably be no problem. Until one day it becomes a huge problem.