Some background info:
* I have 0 JPY
* I have about 10,000 USD in a checking account
* The rest is all in US stocks on a US brokerage
* I’m planning to move to Japan for work in a year or so
* I will immediately become a permanent resident due to my US/JP dual citizen status
* Confused about what triggers exchange rate tax
Scenarios:
* JPY > USD > JPY: This one is pretty straight forward, I “invest” in dollars using earned yen, so if I exchange it back to yen I’d have to pay taxes on the gain. My cost basis is the amount in JPY at the time of USD purchase.
* USD > JPY: This is the one I don’t understand. Do I owe taxes if I use the dollars I had previous to moving to Japan? What would the cost basis even be?
* Credit Card: Similar to the example above, what happens if I use my US credit card in Japan and pay it off using US earned dollars? Would this trigger exchange rate taxes?
* Sell US stocks on US exchange: I understand the capital gains part. Question is once again how is my exchange rate tax cost basis determined if I owned these stocks before moving to Japan?
by KumichoSensei