Hi! I am a US citizen and resident. This year, my work is requiring me to spend about half the year in Australia. I have an Australian bank account to make life easier and opened a second forex account denominated in AUD. I currently am trading two forex accounts: a USD account, as well as forex account denominated in AUD. How am I taxed on the funds I make through trading/interest in my AUD denominated account?

As a US citizen, you are taxed on worldwide income, so you report all income and expense from Australia, as if it were just another state in the US.

If you pay Australian tax, you probably qualify for a foreign tax credit (FTC) in the US. You may want to check tax treaties too.

You need to report your foreign bank account each year in the US.

Sounds like you don't qualify for the Section 911 foreign earned income and housing allowance exclusions, since you are not a bona fide resident or physically present long enough in Australia.

Learn all the tax rules and best strategies in our article:
Trading Across Borders: The Tax Issues by Robert A. Green, CPA
Don’t leave home without them. Click here http://www.greencompany.com/Educatio...lTraderTax.pdf for Green's original submission. The final SFO article is available on the SFO site for purchase, or pick up the print magaine.

There may be some special tax strategies in regards to account balances and whether or not you need to convert them back to dollars each year.

Consider a consultation to discuss it all. http://www.greencompany.com/Traders/...nsulting.shtml

Thanks.

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