Mobility Matters Express video series

Get out in front of disruptive forces by staying up to date on the issues and developments from around the world that impact global mobility programs and their assignees.



Mobility Matters Express: Financing and selling a non-U.S. residence

May 24, 2022

Inbound assignees to the United States are often surprised by the U.S. tax consequences of selling their residence in their home country.  In this episode, Washington National Tax’s Martha Klasing highlights a potential tax trap for inbound assignees selling their homes: foreign currency exchange gain. 

Mobility Matters Express: Becoming a U.S. tax resident: What does it mean?

May 17, 2022

In this episode, Washington National Tax’s Martha Klasing provides an overview of the U.S. federal income tax consequences of establishing U.S. tax residency.  

Mobility Matters Express: IRS guidance on withholding taxes paid by employer

April 26, 2022

In this episode, Washington National Tax’s Martha Klasing provides an overview of the IRS’s Chief Counsel Advice Memorandum regarding tax-equalized assignees and the related income taxes paid by the employer as part of the tax equalization program.  

Video transcript

Hello -  I’m Martha Klasing from KPMG’s Washington National Tax practice and welcome to Mobility Matters Express.  

The IRS recently issued a Chief Counsel Advice Memorandum that is directly on point with respect to  tax-equalized assignees and the related income taxes paid by the employer as part of the tax equalization program.  The CCA basically reiterates what we already know and confirms how most organizations approach the payroll withholding and reporting for tax equalized assignees.  In a nutshell, reportable wages are reduced by the amount of hypothetical tax withheld by the employer.  Any actual taxes paid by the employer on behalf of the employee directly to the government as withholding represent taxable wages and should be grossed up for taxes.  One point the CCA underscores is the general rule that adjustments or corrections to the amount of taxes paid can only be done within the same calendar year, except in very limited circumstance.  The takeaway - which has always been a best practice - is to calculate hypothetical tax withholding as accurately as possible and make any adjustments needed to actual taxes paid into the US government before the calendar year closes.  Thanks for joining this segment of Mobility Matters Express!  

Mobility Matters Express: Foreign exchange gain/loss proposals in the Biden 2023 budget

April 8, 2022

In this episode, Washington National Tax’s Martha Klasing provides an overview of the proposals contained in the Biden Administration’s FY 2023 budget that are designed to simplify the foreign currency exchange gain and loss rules for individuals. 

Video transcript

Hello and welcome to KPMG’s Mobility Matters Express.  Included in the recently released Biden administration budget are several proposals designed to simplify the foreign exchange rate gain and loss rules for individuals.  These proposals would be a welcome modernization of some very complex rules that oftentimes catch international assignees and their employers unaware.  One proposal would allow individuals to use an average annual exchange rate to report wages received in a foreign currency rather than using the spot rate.  Another proposal would increase the tax-free exemption for foreign currency gains on personal transactions from $200 to $500 per transaction.  Lastly, and very impactful as it is significant taxpayer friendly proposal is individuals would be allowed to offset the gain on the sale of a foreign personal residence with losses realized on the repayment of a foreign currency denominated mortgage.  Currently foreign currency losses on repayment of a foreign mortgage are not deductible even if the individual realizes a taxable gain on the sale of the residence, so again this would be a very welcome improvement. 

The takeaway? Ultimately, it rests with U.S. Congress to pass legislation implementing any of these recommendations. However, these changes could simplify reporting and result in reduced US tax costs, and hence reduced tax equalization and overall assignment costs.  Definitely something we will want to keep an eye on.  That’s it for this segment and, as always, thanks for listening in.  



Mobility Matters Express: Tax proposals in the Biden 2023 budget

April 1, 2022

In this episode, Washington National Tax’s Martha Klasing provides an overview of some of the income tax proposals contained in the Biden Administration’s FY 2023 budget that would impact individual taxpayers and the cost of international assignments if enacted. For additional information and analysis on the Biden Administration’s tax agenda, please see KPMG’s dedicated TaxNewsFlash page.

Video transcript

Hello, and welcome to KPMG’s Mobility Matters Express.  On the heels of the Biden Administration’s release of its Fiscal Year 2023 budget proposals, the U.S. Treasury Department published the Green Book, which is an explanation of the tax proposals in the budget.   Some of the proposals, if enacted, could increase taxes for certain individuals. We’d like to draw your attention to a few of them.   

One proposal would increase the top marginal tax rate to 39.6% for high-earners (those earning over $450,000 if married filing jointly, and those earning over $400,000 if filing single). Capital gains would be taxed at ordinary rates for individuals with taxable income exceeding $1 million, and a minimum tax of 20% would be imposed on total income for very wealthy taxpayers whose net wealth is greater than $100 million. 

Also, carried interests for higher income individuals would be taxed at ordinary income rates and not benefit from the lower capital gains rates. There is no immediate impact on assignees or assignment programs, since these are just proposals, but worth keeping an eye on.  It remains to be seen if these proposals will be legislated. That’s your update for today, thanks for listening in.  

Mobility Matters Express: Foreign housing cost limitations

March 23, 2022

In this episode, Washington National Tax’s Martha Klasing shares her observations with respect to IRS Notice 2022-10, which provides for adjustments to the limitation on housing expenses for purposes of section 911 of the Internal Revenue Code for the 2022 tax year. For additional details, please see GMS Flash Alert 2022-047.

Video transcript

Hello - and welcome to Mobility Matters Express.   

The IRS released Notice 2022-10 with an updated list of foreign locations with high housing costs for purposes of the section 911.  The Notice is effective for taxable years beginning after 2021. If a location is not listed, then the statutory amount equal to 30% of the foreign earned income exclusion ($33,600 for 2022) applies.  What’s interesting, and a departure from prior years, is more locations experienced a DECREASE in the adjusted limitation amount versus an increase.  This will impact individual’s US tax cost.  Out of 266 total locations listed, 151 have seen a decrease, including some locations usually associated with a high cost of living - notably Tokyo, Riyadh, and Zurich.  Hong Kong – the city with the highest limitation amount at $114,300 remains unchanged.  Only 20 locations were increased - mostly located in Canada. The takeaway?   If the newly released housing limitation amounts are higher than those provided for 2021, taxpayers may elect to use the higher 2022 amounts on their 2021 federal income tax returns resulting in additional US tax savings. Thank you for joining this segment of Mobility Matters Express!  








Video host

Martha Klasing

Martha Klasing

Partner, Washington National Tax, Global Mobility Services, KPMG US

+1 202-533-4206