Question:
Facts:
CFO, CPA (not a tax person), 28 years with the same
company. Divorced with non-dependent children. Forced
retirement as of 12/31/2002 with a terrific job
opportunity in Ireland.
Questions:
1. Will my trips to Ireland to interview be deductible
against my 2002 income? I itemize.
2. Given a salary in excess of the foreign sourced income
exclusion, if I purchase a condo in Ireland, will I be
able to itemize the interest or should I purchase it
outright?
Answer:
-1. All job search expenses (for the same profession currently
employed in) are deductible as a miscellaneous itemized
deduction subject to the 2% AGI floor.
2. The income or its source has no effect on the deductibility
of acquisition debt interest expense.
-1. Job search plus some relocation expenses are deductible.
Doesn't matter where.
2. Note that for some temporary living expenses not to
exceed one year--rental may be deductible --so depending
upon your expected tenure you may be better off with some
rental agreement? (Structure a rent to buy option if ok
under local law.)
Why rush to buy anything?
Rest is beyond me--and you really do need to think thru the
foreign tax rules and if you will be outside USA for some
time the full exclusion of foreign income. Get somebody
familiar with this stuff--not a US only oriented person.
PS ownership abroad may be all sorts of problems when it
comes time to sell or if you die/will/probatel.
Tax and accounting counsel as part of your job search may
well be deductible. Don't skimp.
PS you sure as heck don't want to be a resident of some
state or city that taxes foreign income. Think thru severing
loose ends.
