NonResident from GR inherits IRA and 401(k)
At what rate will he be taxed? He cashed out both accounts, $19k in the IRA and $8k in the 401(k), $100 or so in taxable account dividends. I cannot seem to find anything in the treaty that specifically addresses this. This is all the US source income he has.
Permalink Submitted by mk foss on Sat, 2014-03-29 01:25
IRA custodians withhold U.S. tax at either 30% or the treaty rate on IRA distributions. I’m not sure what 401(k) administrators are required to do. If there’s withholding, no U.S. return would be required. This assumes that the nonresident is not a U.S. citizen or green card holder.