As a Japanese citizen with U.S. permanent residency who retired in 2013. I spent approximately 9 to 10 months each year in Japan and the remaining 2 \~ 3 months in the U.S. from 2013 to 2022. For 2023, I was in the U.S. for almost 11 months.
From 2013 to 2022, I consistently filed U.S. tax returns as a resident but unintentionally didn’t file Japanese tax returns. I realized this when consulting with a certified accountant (公認会計士) on another matter in Japan. She mentioned that, for tax purposes, I’m considered as a Japanese resident (2013-2022) and should have been filing Japanese tax returns. My income includes social security benefits and proceeds from annual ETF sales from my 401k and Roth IRA. Since my retirement in 2013, I haven’t worked in either Japan or the U.S. The certified accountant will assess my situation to find the most cost-effective solution to fix the problem, but has anyone in the community done something similar to what I did, and if so, how did you resolve the issues? Could you please share your experience?
Thank you
by Serious_Stock_1632
9 comments
Please tell us what your certified accountant determines. Thanks!
Did you owe tax the years you filed in the US? It looks like you will also need to refile your US returns for the past three years as well (possibly two (2021/2022) depending on when you paid your last US tax bill).
If you did pay tax those 2/3 years, you could get that back to apply against Japan tax owed. Did you your CPA indicate the NTA statue of limitations? Can you make an offer in compromise?
how are you a Japanese tax residence? If you are retired and live in the us you are not taxed in Japan but the us. what do you mean with “spent about 9 months in Japan” ? is that for one year or from 2013 till 2022 ?
If you were a tax resident of Japan for those years (which seems likely, but I’m not an expert) then you probably owe Japanese income tax for those years.
On the flip side, being a Japanese tax resident almost certainly means you were *not* a US tax resident and therefore using FTC you probably didn’t owe tax in the US for those years, or very minimal amounts of tax. After so much time has passed I am not sure if you can get your US tax back for all the years but you might be able to get it back for some of them. You will need to work with an accountant in the US, too.
Did you reside and pay Japan taxes before 2013? Do you still have a residence in Japan that you were using for 9/12 months per year.
https://taxsummaries.pwc.com/japan/individual/residence
I also need financial guidance on a matter such as this. Anyway you could direct me to where you found your advisor, or tell me how you found them?
In many countries, where you’re considered a tax resident is based on how many days a year you spent there, often it’s around 183 days (i.e., more than half), then you’re expected to pay tax. It seems you spent more than that for each year between 2013 and 2022.
The US also has some kind of rule like this (am not American so don’t know details). As you spent very little time in the US in those years perhaps you didn’t need to pay US taxes and do need to pay Japan taxes, but also JP & US have some kind of mutual tax deal. You probably need a tax expert to help here, but these could be directions to look in.
A side note: I think the NTA here will only be concerned with the previous five years, but I’m not sure how they count this with regard to 2023 as a tax year. If it is not counted (probably not), then you’d be filing for 2022, 2021, 2020, 2019, and 2018.
Another discussion on [residency/domicile.](https://www.reddit.com/r/JapanFinance/comments/196xtxr/how_not_to_become_a_tax_resident_in_japan/)