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Old 14-02-2020, 08:54 PM   #1771
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Hi BBCWatcher,

There has been talk about a potential downturn of the economy because of the corona virus. Do you have any general advice for us in this market? Is putting monies into gold a good short term option? I have seen people suggesting buying GLD through IB as a hedge at this point. Please can you let us know your thoughts. Sorry if you have written it elsewhere. I went back a few pages but could not find anything on this.
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Old 15-02-2020, 06:31 PM   #1772
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Hi BBCWatcher, I was recently admitted to a US university for a master degree, which typically recommends the students to undergo an internship before graduation (and I plan to get some working experience over there as well). For some background, I'm an Indonesian national and a Singapore PR.

I recall that I've signed forms with banks/brokers stating that I'm not a US resident, US person or resident alien (I can't recall the exact terms), would working or doing paid internships and therefore paying US taxes change this?

Most of my investments are in IB (IWDA/EIMI etc) and SSB, considering that the US has capital gain taxes, what are the things that I should look for prior to my arrival in the US? I'd appreciate if you can point me to some additional resources to read as well.

Thank you!
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Old 15-02-2020, 08:21 PM   #1773
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Hi BBCWatcher,

About the Singapore 6 month T bill, is the cut-off yield that is announced at close of auction the yield the successful applicant will receive?
Thanks in advance.

They announce 3 types of yield:
Average yield
Median yield
Cut-off yield

Last edited by Shine.gdj; 15-02-2020 at 08:55 PM..
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Old 15-02-2020, 09:31 PM   #1774
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Hi BBCWatcher, I was recently admitted to a US university for a master degree, which typically recommends the students to undergo an internship before graduation (and I plan to get some working experience over there as well). For some background, I'm an Indonesian national and a Singapore PR.

I recall that I've signed forms with banks/brokers stating that I'm not a US resident, US person or resident alien (I can't recall the exact terms), would working or doing paid internships and therefore paying US taxes change this?
What’ll be your U.S. visa type?

About the Singapore 6 month T bill, is the cut-off yield that is announced at close of auction the yield the successful applicant will receive?
If you place a noncompetitive bid, yes. That’s the only type of bid individual investors should be making.
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Old 16-02-2020, 02:48 PM   #1775
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What’ll be your U.S. visa type?
It should be F-1 visa, and the program qualifies for the STEM OPT extension (total of 36 months allowance to work after completing the program - during which ex-students typically try to get sponsorship for H-1B).
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Old 16-02-2020, 03:07 PM   #1776
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It should be F-1 visa, and the program qualifies for the STEM OPT extension (total of 36 months allowance to work after completing the program - during which ex-students typically try to get sponsorship for H-1B).
OK. On a F-1 you won’t be subject to the U.S. tax system except for your U.S. income, and as long as too much time hasn’t passed. Nonetheless, you may still wish to make your assets “U.S. tax friendly” before flying to the U.S. in case you decide to stay longer (perhaps a lifetime?) and assuming you’re allowed to do that.

Look for my recent post in answer to a prospective J-1 visa holder since those rules and opportunities are pretty similar.
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Old 16-02-2020, 03:11 PM   #1777
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OK. On a F-1 you won’t be subject to the U.S. tax system except for your U.S. income, and as long as too much time hasn’t passed. Nonetheless, you may still wish to make your assets “U.S. tax friendly” before flying to the U.S. in case you decide to stay longer (perhaps a lifetime?) and assuming you’re allowed to do that.

Look for my recent post in answer to a prospective J-1 visa holder since those rules and opportunities are pretty similar.
Thanks, I'll look at your recent posts.

I'm still reading on the details of the different visas, but ultimately I would definitely like to get a few years of relevant working experience over there - and I'm not opposed to the idea of staying for a long time. So yes I'd like to make my assets US tax friendly as you've put it, rather than having to worry about it later on when I actually convert to an H-1B or even other visas.

Edit: I appreciate the advice on setting a financial footprint in the US (US bank accounts, credit cards), that's what I plan to do. I might also use IB to transfer my tuition and living cost as it's quite a bit cheaper than other options (SGD from SG bank > SGD in IB > USD in IB > USD to US bank, after I open an account there).

If I understand correctly, I won't need to do anything to my IWDA/EIMI portfolio while I'm on F-1, and I should use the available plans (e.g. 401(k)) with tax advantages when I do start working in the US?

Last edited by lemniscate; 16-02-2020 at 03:55 PM..
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Old 16-02-2020, 05:15 PM   #1778
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If I understand correctly, I won't need to do anything to my IWDA/EIMI portfolio while I'm on F-1, and I should use the available plans (e.g. 401(k)) with tax advantages when I do start working in the US?
You won't need to do anything with non-U.S. funds such as IWDA and EIMI, but those funds (and others like them) are U.S. tax "hostile" to U.S. persons. The only way they work is if you never become fully subject to the U.S. tax code. For example, if you remain on your F-1 visa for 4 years, maybe earn a little bit of U.S. income working for the university (within the bounds allowed on your F-1), then you leave.

If you think you might stay -- you meet the love of your life and get married, for example -- then you don't want to be holding non-U.S. funds like IWDA or EIMI since they're considered "Passive Foreign Investment Companies" (PFICs). Even things that seem like simple stocks often are PFICs. So, strictly before you become a U.S. person -- and highly preferably sometime the calendar year before -- I would exit those positions and recast them into a more U.S. tax friendly posture. One simple way to do that is to sell both IWDA and EIMI and reinvest the proceeds in VT, Vanguard's U.S. domiciled Total World Stock ETF listed on the New York Stock Exchange.

There doesn't seem to be any limitation on F-1 visa holders participating in U.S. tax advantaged accounts such as IRAs, 401(k)s, 403(b)s, and 529s as long as you otherwise qualify. It'd be a good idea to avail yourself of those opportunities if you can, if you qualify.

Note that you're evidently allowed to enter the Diversity Immigrant Visa lottery every October. Note also that you'll likely have some future difficulties renewing your Re-Entry Permit (REP) for your Singapore Permanent Residence if/when you're no longer a de facto resident of Singapore.
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Old 16-02-2020, 05:34 PM   #1779
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If you think you might stay -- you meet the love of your life and get married, for example -- then you don't want to be holding non-U.S. funds like IWDA or EIMI since they're considered "Passive Foreign Investment Companies" (PFICs). Even things that seem like simple stocks often are PFICs. So, strictly before you become a U.S. person -- and highly preferably sometime the calendar year before -- I would exit those positions and recast them into a more U.S. tax friendly posture. One simple way to do that is to sell both IWDA and EIMI and reinvest the proceeds in VT, Vanguard's U.S. domiciled Total World Stock ETF listed on the New York Stock Exchange.

There doesn't seem to be any limitation on F-1 visa holders participating in U.S. tax advantaged accounts such as IRAs, 401(k)s, 403(b)s, and 529s as long as you otherwise qualify. It'd be a good idea to avail yourself of those opportunities if you can, if you qualify.
Thanks for the confirmation. I think closing my IWDA/EIMI positions in the preceding calendar year might be a good idea. I'll also do some more research on the different tax advantaged accounts.

Note that you're evidently allowed to enter the Diversity Immigrant Visa lottery every October. Note also that you'll likely have some future difficulties renewing your Re-Entry Permit (REP) for your Singapore Permanent Residence if/when you're no longer a de facto resident of Singapore.
Losing my Singapore permanent residency (rightly so) is a trade off I've considered and accepted before applying for further study abroad. Even if I return to Singapore before my 5-year REP expires and get employed here again, it would probably be hard for the ICA to justify renewing my REP given the 2-3 years of missing "economic contribution" to Singapore.

If I eventually end up going back to Singapore for whatever reason, and lose my PR then I'll have to settle for an EP and possibly reapply for PR (I just hope that losing my current PR due to lack of presence in Singapore wouldn't put me on ICA's blacklist for work permits, but of course no one knows about that).

Thank you for your advice. I've been reading many of your past posts in the forum, from investments, CPF to insurance. You've been a great help!
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Old 16-02-2020, 05:58 PM   #1780
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Losing my Singapore permanent residency (rightly so) is a trade off I've considered and accepted before applying for further study abroad. Even if I return to Singapore before my 5-year REP expires and get employed here again, it would probably be hard for the ICA to justify renewing my REP given the 2-3 years of missing "economic contribution" to Singapore.
It's up to the Immigration and Checkpoints Authority, but I think you'd be likely to get at least a one year renewal in the scenario you describe. Spending a couple years getting a Master's degree overseas to improve one's knowledge is a perfectly reasonable thing for PRs to do, and I expect the government understands that.

Note that technically you don't need a Re-Entry Permit as long as you scoot back to Singapore before your REP expires and stay physically in Singapore. You only need a valid, unexpired REP to re-enter Singapore, exactly as described. If you never leave Singapore, then you never need to re-enter. Yes, this includes taking the bus to Johor or the ferry to Batam.
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Old 16-02-2020, 06:23 PM   #1781
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Yes, I did drop them an email regarding the matter and they told me that they'll have to consider on a case-by-case basis whether they will approve the REP renewal or not. I just thought that I should prepare for the worst case (not like I have any idea how many years of work experience I want to get before returning, and I'm still open to the possibility of staying over there permanently).

Staying as a PR in the country without REP does sound like it'd make for an amusing experience though.
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Old 16-02-2020, 07:03 PM   #1782
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BBCW, how can we judge how long banks can sustain with this virus situation?
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Old 16-02-2020, 08:34 PM   #1783
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BBCW, how can we judge how long banks can sustain with this virus situation?
The banks had no particular problems with SARS, the most similar comparison available. Why, what do you have in mind?
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Old 16-02-2020, 09:52 PM   #1784
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The banks had no particular problems with SARS, the most similar comparison available. Why, what do you have in mind?
I have invested in them thinking if I need to do something about it. How about HK banks? Would they be of more concern of getting into financial problems?
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Old 17-02-2020, 07:28 AM   #1785
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I have invested in them thinking if I need to do something about it.
1. Why did you buy individual bank stocks?
2. Why do you feel you need to “do something about it”?
3. Why now?

How about HK banks? Would they be of more concern of getting into financial problems?
4. What does a bank do? How does it make its money? (As a bank stockholder, one would think you should understand at least the basic business model of banks. So let’s review the basics.)
5. How would #4 be affected if COVID-19 gets worse, better, or stays about the same?
6. If you were to divest of your bank stocks, where would you redeploy these funds?

Last edited by BBCWatcher; 17-02-2020 at 07:30 AM..
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