American in Switzerand Investment Account in USA

Finance, Taxes, Banking, Insurance and Retirement
1
Hello -

In the aftermath of FATCA does anyone have experience with how American investment companies like Fidelity and Charles Schwab are handling the USA based brokerage accounts of US citizens residing in Switzerland?

Any information about others in this situation would be appreciated.

Thanks

2

I doubt they’re handling them at all. FATCA doesn’t apply to US based FI’s yet and it’s doubtful it ever will.

3
Yep - Fidelity no longer allows Swiss (and perhaps other overseas) customers to continue investment activity. If one has an IRA one may leave the account as is, but no further activity will be allowed. Which could (obviously) seriously impact the performance of one's account.

We moved our Fidelty accounts to the US arm of our Swiss bank. Now these two are fully separate legal entities so there is no coordination between them. There is, though, at least a bit more understanding that an investor might indeed legitimately live outside the US.

4
Charles Schwab has the same guidelines as Fidelity. We were forced to move our main investment account elsewhere, however the IRAs and gold/silver investments were allowed to remain.

5
Not a direct answer, but my US retirement and investment funds held by another US investment company were just frozen as the company decided to stop doing business with all overseas account holders, even long term ones like myself. Indeed it is becoming impossible to invest for ones future if one owns the toxic blue passport, even in ones own country.

6
Meloncollie - If you wouldn't mind, which US arm of which Swiss bank? Are you able to trade the account or is it simply held there without any manipulation allowed.

Thanks

7
Just floated through the Linkedin Expat groups:

I need to know if this is still going on. I appear to still be able to trade.

This is, as they say, zusamen scheisse.

8
As a former greencard holder, Schwab have been rather flexible about everything. They even let me open an IRA so that I could roll my 401(k) into, although I admit that it took them a while to cope with why a non-USC and non-US-resident would even need a new IRA account. But I guess they don't deal with former GC holders very much.

Schwab let me change countries twice since leaving the US without a problem, and I don't have any restrictions on my brokerage or IRA accounts. As far as they're concerned I still have a SS# (you can't give that up) and they just need to know where to send my 1099s each year and after that it's up to me to file taxes if I need to. From what I understand, this is the same as if you're a USC and have US accounts: they just need to know where to send the required forms so you can do your taxes.

The problems with FATCA occur if you're a USC and you want to open a foreign bank or brokerage account, as quite a number of banks these days just don't want to deal with the FATCA paperwork and won't entertain opening accounts for USC or (current) greencard holders.

9
We have a Fidelity account holding stock from a previous employer of my husband. This is not growing beyond dividends...and I think there is a separate login page for non-US residents.

The current employer is using Merrill Lynch. These 2 are for ESPP accounts and not mutual fund accounts.

We have a Vanguard account and I have not had problems with them and my overseas address.

I don't see why these would be a problem as US banks report to the IRS so it shouldn't matter where you live, should it? crazy...another reason to just go back to the states.

10
Fidelity stopped my trading account. However, my Ameritrade account is still working fine.

11

No issues with Schwab.... they provide you a toll free number and your account is managed via UK. Toll free # is 0800 56 38 21

Swiss residents are not supposed to use ETFs - theoretically, but I trade them and Schwab does not have any issues with that.

I think Schwab does a great job for me - every question is always answered quickly. Their help desk is very professional.

Though, I do sense the size of the account probably determines the service levels to a certain extent.

FATCA is irrelevant as it is US based and all of the tax reporting is done by them.

-D

12
Schwab does have a great premier account that allows your to withdraw from Swiss atm's with no transaction fees.

13
I forgot to say earlier, but you can get Schwab to send you a security token to protect your account: it's really not obvious from their website that they have such a thing, but I for one feel much happier that even if some hacker managed to get my password, that they still couldn't log in to my account without also having the token code.

I got them to Fedex mine for free to Switzerland...

14
http://www.schwab.com/public/schwab/...t_your_account - bottom of the page.

15
I never told TD Ameritrade nor Fidelity (nor any of my other US investments) that I moved 8 years ago. It never crossed my mind that I needed to inform them of my residency status. All of my statements and info go to my US address. As I am reporting everything on both my Swiss and US returns, so far, it hasn't been a problem.

16
An interesting article by American Citizens Abroad on this very subject:

https://americansabroad.org/issues/b...-restrictions/

17
E*Trade say the same when it comes to mutual funds, these days: https://content.etrade.com/etrade/es...ional_Info.pdf

But regular US stocks and ETFs can still be traded, it seems - so no restriction on account ownership, just what they let you trade.

18
I was asked to explain to Fid- why I had standing wire instructions to a US domestic bank account AND a domicile/permanent address abroad. I had to educate them on the right for non-residents to hold US domestic bank accounts (there are no restrictions apart from sanctioned countries, as far as I can tell) AND the right for non-residents not to reside in the US.

They seemed happy with the explanations.

They blocked further activity in US mutual funds though, through a separate process.

Waiting (not) for the next steps. Many non-resident, whether still US or former citizens, and also on temporary visas, have IRA accounts from former US presence and hopefully we will be able to use domestic bank accounts to withdraw money when we retire,as I doubt it could be wired abroad directly.