My husband and I are thinking about retiring in Japan after he’s done working for 20 years in the military. I’m Japanese and a green card holder so he’d get a spousal visa there.
His retirement plan is High3 and voluntarily contributing Roth TSP. We also have 2 Roth IRAs and I know these will be taxed in Japan at the time of withdrawal. Mine would be cashed out before moving there even if I’d have to pay the 10% penalty and federal/state taxes since I need to surrender my visa status.
Regarding Roth TSP, would it be treated as a pension plan from the US government and won’t be taxed in Japan based on The US/Japan tax treaty? But technically he’s not on BRS and voluntarily contributing it so I feel like it’d be treated as a normal taxable account from the NTA’s point of view.
If it will be taxed in Japan , should he change his plan to Traditional TSP now and avoid double taxation claiming the foreign tax credit when he withdraws the contributions in Japan?
I’ve done my research but it’s too complicated since our nationalities are different so are the taxation systems.
by rikhn
