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1. FINANCIAL EDUCATION SUMMER 2018 EDITION Americans Abroad May Get Hit By Trump’s New Repatriation Tax Rules Page - 2 What did you Learn from Financial Literacy Month? Page - 3 The Restrictions on Investing as a U.S. Expatriate Page - 5

2. 2 SUMMER 2018 Americans Abroad May Get Hit By Trump’s New Repatriation Tax Rules By Beacon Financial Education N Jobs Act of 2017, Donald Trump made changes to tax rules for Americans living at home and abroad. A big change for those living abroad are the repatriation tax rules. These changes may affect huge multinational corporations and small time Americans living abroad. This article goes into the basics of the repatriation tax rules and how they affect those holding cash abroad. ovember2016 caused a big shift in U.S. ideology and it also is responsible for a flurry of tax changes. With his Tax Cuts and A major provision of the Tax Cuts and Jobs Act of 2017 are the repatriation Tax Rules. These tax rules tax U.S. corporations on the profits of their foreign counterparts (called CFCs, controlled foreign corporations) on profits earned from 1986 to December 2017. These tax rules tax profits held in cash at 15.5% and non-cash assets at an 8% rate. While the new tax rules may affect CFCs, they will help Uncle Sam. Congress itself expects this one time charge to bring in $339 million over the next 10 years. may hurt U.S. citizens living abroad. This U.S. reform treats individuals the same way it treats corporations. If an American expat owns 10% of foreign corporation and the foreign corporation is at least 50% American owned, then this expat is subject to the same tax rules as multinational corporations. With the new tax rules, Americans abroad could face unknown waters. Speak with your financial advisor today to find out if the Tax Cuts and Jobs Act of 2017 has an effect on your bottom line. Although these new tax laws could help the U.S. government, they www.beaconfinancialeducation.org

3. 3 SUMMER 2018 What did you Learn from Financial Literacy Month? Financial Literacy Day. Three years later, in 2003, the United States Senate designated April as Financial Literacy for Youth Month and one year after that, in 2004, the United States Senate passed Resolution 316 that newly recognized April as Financial Literacy Month. In 2005, under a Bush controlled White House, the U.S. House of Representatives passed a bill supporting the goals and ideals of Financial Literacy Month. This bill issued a proclamation that called on the Federal Government, States, localities, schools, nonprofit organizations, businesses, and the people of the United States to observe the month with programs and educational opportunities that promote financial literacy. By Chris Gitre A learned. Before we recap some important terms, lets go over the history of Financial Literacy month. Financial Literacy recognition first started in 2000 when the National Endowment of Financial Education introduced Youth pril was Financial Literacy month. And as we head full fledge into the summer months, let’s take a look at what we www.beaconfinancialeducation.org

4. 4 SUMMER 2018 Given that Financial Literacy month was only a few months ago, let’s recap some obscure terms. If you know all these terms, you’re financially literate! If not, well, you’re on your way! Mutual Fund 1 A Mutual Fund is a professionally managed collection of money from a group of investors. A mutual fund manager invests your money into some combination of stocks, bonds, or other products. Individual Development Account (IDA) A matched savings account in which an organization like a foundation, corporation, or government entity agrees to add money to your account to match the money you save in it. 2 Roth Individual Retirement Arrangements (IRAs) 3 Annual Percentage Rate (APR) 4 A Roth IRA is not tax deductible while a traditional IRA is. Additionally, the distributions from a Roth IRA are not included in income. An APR helps evaluate the cost of the loan. If you have an APR of 10%, then you pay $100 for every $1,000 borrowed annually. Annual Percentage Yield (APY) 5 The APY is the actual amount of return on an investment. To calculate the APY, take 1 plus the ‘periodic’ rate and raise that to the number of periods in a year. So a 5% per quarter rate would be (1.05^4), 21.6%. Now that you know the difference between an APR and an APY, you may have questions regarding some of these other terms like IDA and IRA. Speak with your financial advisor on how to get the most out of your financial literacy. www.beaconfinancialeducation.org

5. 5 SUMMER 2018 The Restrictions on Investing as a U.S. Expatriate A different culture. But times can also be tough. More and more, Non- Resident Americans are finding it difficult to get U.S. investment services. As policy changes, Americans who remain clients of U.S. financial institutions are finding their services are restricted. This article details the changes expatriates are facing and some of the reasons behind these new infrastructure. By Beacon Financial Education s an expatriate, times can be free and easy-living in a different country, enjoying a With the introduction of FATCA, where foreign bank accounts can be imposed a significant tax, U.S. Non- Residents are finding it increasingly difficult to find a financial institution. Although it is more difficult for an American expatriate to find a Non-U.S. financial institution, U.S. financial institutions are also turning away U.S. Non residents. While FATCA regulation is a driver, enhanced treasury enforcement of anti- money laundering regulation and evolving interpretation of the 2003 Patriot Act are also a culprit. implemented policies which prevent non-U.S. residents from purchasing their funds, including Americans abroad. However, the rules regarding this restriction are nothing new. Rules preventing non- U.S. residents from purchasing mutual funds are decades old. It is modified due diligence procedures, however, which have resulted in more thorough compliance of these long standing regulations. The reason for this restriction is because U.S. fund groups are not allowed to solicit overseas business for SEC-registered funds. This includes U.S. expatriates as well. Offering shares of mutual funds to non-domestic clients could potentially violate laws of foreign countries which they reside in. Second, due to tax treaty claims, funds must certify all shareholders are residents of the United States. In addition to increasing difficulty in finding financial services, Non-Resident Americans are simply restricted from owning U.S. Mutual Funds. Reported initially by the Wall Street Journal, many U.S. mutual fund companies have As an expatriate, navigating the U.S. financial system is murky waters. Speak with your financial advisor today to get set up with a financial institution who has your peace in mind and in addition that will help with your financial goals. www.beaconfinancialeducation.org

6. Beacon Financial Educationwants to thank all the wonderful expat friends we have made and the preferred partners who provide excellent service to the ever-growing global mobility community. We are looking forward to developing new seminar programs and speaking more about the importance of financial education. We offer daily posts on topics such as Expat life, American’s living abroad, global mobility, economic news and so much more.  info@beaconfinancialeducation.org www.beaconfinancialeducation.org PLEASE FOLLOW US ON SOCIAL MEDIA Beacon Financial Education does not provide financial, tax or legal advice. None of the information should be considered financial, tax or legal advice. You should consult your financial, tax or legal advisers for information concerning your own specific tax/legal situation.