# UK to US - Bentonville Advice



## jtj (Dec 30, 2013)

Hi All,

So we are well on our way with a potential move from the UK to the US, my wife has been offered a relocation package from the UK to the US on a L1a visa.

For information, we are both 27, and have just recently married after several years.

We are of the understanding that as she is being offered the L1A visa, this will also entitle me to work whilst in the US, if I can find employment, I am a qualified business analyst with plenty of experience.

We would be based in bentonville, Arkansas.

After doing plenty of research online, I thought I would reach out to all you helpful guys for some pointers in the right direction.

So here are my questions:

We currently own a property in the UK and are not looking to sell this but hopefully plan to move on a BTL mortgage and will let the property out, if circumstances allow this, does anyone have any advice on the tax implications of this, benefits / drawbacks, etc?

As we are recently married, and plan to start a family in the near future, what are the implications of this and health care in the US?

What is the best process for transferring money from the UK and US in the future?

Does anyone have any experience of the Arkansas area?

What are the implications on our UK based pensions?

What is the best thing to do in relation to not paying UK NI contributions and the impact on the state pension, I understand the UK does not freeze the state pension when moving to the US, so is it worth making contributions?

What are the tax rates I need to take into account for working / living in Bentonville?

Any advice in relation to 401k plans, would be beneficial

If anyone has negotiated a relocation package with an employer any pointers would be beneficial

Another concern of ours, is hopefully I will be able to find work 

As some of you have been through this process any questions I am missing or information you may think is beneficial, please feel to give me pointers so I can ensure all bases have been covered.


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## BBCWatcher (Dec 28, 2012)

jtj said:


> We currently own a property in the UK and are not looking to sell this but hopefully plan to move on a BTL mortgage and will let the property out, if circumstances allow this, does anyone have any advice on the tax implications of this, benefits / drawbacks, etc?


I don't know the full tax implications, but I know of one thing to be careful of. If you sell the property while you are subject to the U.S. tax system the capital gains on that property may be taxable in the U.S. unless the U.S.-U.K. tax treaty says otherwise, and subject to deduction from U.S. taxes of any U.K. taxes paid (foreign tax credit). The U.S. generally exempts the first $250,000 in net gains from U.S. tax. However, you lose some or all of this $250K exemption if you haven't lived in the property yourself a sufficient amount of time within the past few years.

Also, the rental income could be subject to U.S. tax, again with the treaty and U.K. foreign tax caveats mentioned above.



> As we are recently married, and plan to start a family in the near future, what are the implications of this and health care in the US?


Fine. Lots of babies are born in the U.S. All babies (except sons/daughters of foreign diplomats) born in the U.S. are U.S. citizens from birth, and most people consider that a very nice plus for the baby and his/her future opportunities.

You'll undoubtedly be getting family health insurance through your employer (or your spouse will), and it should be at least pretty good. (If not, let us know.) Prenatal and postnatal care is generally very well covered, and you usually have 30 days to contact your insurance company to add your new baby to your policy. Employer-provided health insurance also often covers infertility treatment to some degree, and new mothers even get one free breast pump.



> What is the best process for transferring money from the UK and US in the future?


First of all, don't move money unless you absolutely must. It always costs money to move money.

The lowest cost ways to move money tend to be via the non-bank currency transfer specialists like Xoom, CurrencyFair, and the many others in that business.



> What are the implications on our UK based pensions?


The U.S. and the U.K. have a social security treaty, and that treaty does allow you (and your employer) to continue your contributions in the U.K. and skip the U.S. system. _However_ it may be in your interest to contribute to the U.S. system if you've already qualified for U.K. benefits. Due to the U.S.-U.K. treaty you can qualify for U.S. Social Security benefits if you have non-trivial contributions in just two calendar years. For example, if you start work in the U.S. in October (2014) and pay into the U.S. system for 3 months, continue working through March next year (2015), then suddenly have to leave for the U.K. for whatever reasons, chances are pretty good even that short 6 month history of contributions into the U.S. system would be enough to qualify you for a small U.S. retirement benefit because your contributions were non-trivial and spanned 2 calendar years. The treaty provides that the U.S. can look at your U.K. contribution history in order to qualify you for the normal 10 year U.S. contribution history, and 2 (or part of 2) is then enough.



> What are the tax rates I need to take into account for working / living in Bentonville?


U.S. federal income tax and Arkansas state income tax. Both have tax brackets with increasing rates on marginal income as your taxable income increases, just like the U.K. You can easily find the federal and state marginal income tax rates online using your favorite search engine.

Note that those rates are applied to _taxable_ income, not all your income.

Arkansas has a state sales tax of 6.5% on most of the goods and services you buy. For the most part the tax is added at checkout and not reflected in advertised prices. Gasoline is a notable exception: all taxes are reflected in the price at the pump.

Bentonville has local property taxes, but they apply only to property you own. If you're renting (as I assume you are) then your agreed rental payments in your lease will include all property taxes paid by the owner.

Like most places, there are car registration fees in Arkansas. You must get an Arkansas driving license soon after you arrive since you're an Arkansas resident. You cannot use an IDP or U.K. license in Arkansas for very much time.



> Any advice in relation to 401k plans, would be beneficial


At your ages I recommend participating Roth 401(k) plans, if offered, and maximizing your contributions if possible. Otherwise, traditional 401(k)s are fine. Do not invest your 401(k) funds in single stocks (such as your employer's). Pick well-diversified, low-cost mutual funds, probably heavily focused on an international stock index fund. Then just leave the money alone. Maximize any employer matches at least.

This recommendation has one important caveat. It critically depends on the fact that your intended country of retirement (e.g. the U.K.) exempts the U.S. tax-advantaged 401(k) accounts from non-U.S. taxation. My recommendation may change if you retire to a country that will tax distributions from your U.S. retirement account.

You will almost certainly have to file FinCEN Form 114 and potentially also IRS Form 8938 to report your non-U.S. financial accounts. Don't forget those annual reports.

You've over 25, so you won't have to register with U.S. Selective Service, but just double check that.


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## NativeTexan (Aug 22, 2014)

Quote: Does anyone have any experience of the Arkansas area?

I currently live in MS but have been in that area recently and actually plan to relocate to that area in early 2015. If I can be of any help, please ask. Thank you.


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## Davis1 (Feb 20, 2009)

Home of Walmart I recall


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## NativeTexan (Aug 22, 2014)

I am not really sure what "home of Walmart" infers. Do you have questions? Northwest Arkansas certainly needs not rely on some Walmart execs living there!!


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## twostep (Apr 3, 2008)

NativeTexan said:


> I am not really sure what "home of Walmart" infers. Do you have questions? Northwest Arkansas certainly needs not rely on some Walmart execs living there!!


Why do you not tell us a bit about what makes you relocate from MS to Bentonville?
Bentonville, Arkansas (AR 72758) profile: population, maps, real estate, averages, homes, statistics, relocation, travel, jobs, hospitals, schools, crime, moving, houses, news, sex offenders


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## NativeTexan (Aug 22, 2014)

*What does my motive have to do with YOUR MOVE??*

Seeing as how you posted a question asking about that area I see NO reason to comment on why I may be relocating there. I did not say why I am going there because it has NO RELEVANCE to your move.

You obviously are younger (age 27) than I am at age 53. So this "cat and mouse" game you have started is quite off-putting. I am a social scientist and usually open to discussion but you are asking questions of ME that are NONE of your business when you purported to be asking questions about the area.

Maybe you do not have the ability to ask the proper questions. That is what I will accept until you ask questions of substance that pertain to YOU. Thanks and move forward.


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## Davis1 (Feb 20, 2009)

It must be a full moon tonight

But I will miss you .. toy are so amusing


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## jtj (Dec 30, 2013)

NativeTexan said:


> Seeing as how you posted a question asking about that area I see NO reason to comment on why I may be relocating there. I did not say why I am going there because it has NO RELEVANCE to your move.
> 
> You obviously are younger (age 27) than I am at age 53. So this "cat and mouse" game you have started is quite off-putting. I am a social scientist and usually open to discussion but you are asking questions of ME that are NONE of your business when you purported to be asking questions about the area.
> 
> Maybe you do not have the ability to ask the proper questions. That is what I will accept until you ask questions of substance that pertain to YOU. Thanks and move forward.


Hi

Apologies for the delay in my response, I have just been bust concentrating on work at the moment and sorting out the visa process, its been complicated by the fact I have sent both my passport and marriage certificate off, just when I need them both for the visa process . . . .

Native Texan: thank you for offering me the chance to speak to you in relation to the arkansas area, I just want to point out that it was other users as per the usernames that have been trolling you not me

Thanks


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## jtj (Dec 30, 2013)

BBCWatcher said:


> I don't know the full tax implications, but I know of one thing to be careful of. If you sell the property while you are subject to the U.S. tax system the capital gains on that property may be taxable in the U.S. unless the U.S.-U.K. tax treaty says otherwise, and subject to deduction from U.S. taxes of any U.K. taxes paid (foreign tax credit). The U.S. generally exempts the first $250,000 in net gains from U.S. tax. However, you lose some or all of this $250K exemption if you haven't lived in the property yourself a sufficient amount of time within the past few years.
> 
> Also, the rental income could be subject to U.S. tax, again with the treaty and U.K. foreign tax caveats mentioned above.
> 
> ...


Amazing knowledge, thanks for sharing this, just what these forums are all about . . . thanks a million


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