K-1 for non resident alien (Trader living in europe)

N

nclsamy

Hello, guys,

First of all, let me thank you for letting me be a part of this forum. I am an absolute begginer in stock trading and I could really use some help!

As the title says, I am living in Europe and I've filled a W-8BEN form so I don't pay taxes in America, except for the 10% withheld tax on dividends. Capital gain taxes are paid in my homecountry.

Last year I day-traded the $UCO (ProShares Ultra DJ-UBS Crude Oil) for almost break even (an <$10 loss). Last week I received my K-1 associated with this ETFs.

I never knew those ProShares ETFs issue K-1s, otherwise I would never trade them (I like to keep it simple as I am currently learning the process).

What should I do with it?

Appreciate any advice a lot!
 
You are not a US Citizen nor a resident of the US. There are many non-us investors that invest in the US (real estate, stock etc). Receiving a K-1 does not in of itself mean you have to a file a tax return. You normally file a tax return only if you have something called Effectively Connected Income which is from a "trade or business" in the US. typically trading stocks does not require this. Easiest thing is to ask a US CPA for details
 
Many thanks for the reply, coolraz! I will try and seek advice from an US CPA. Unfortunately I don't know anyone directly, so I will have to do a google search and try to contact them. All the best wishes!
 
nclsamy said:
Hello, guys,

First of all, let me thank you for letting me be a part of this forum. I am an absolute begginer in stock trading and I could really use some help!

As the title says, I am living in Europe and I've filled a W-8BEN form so I don't pay taxes in America, except for the 10% withheld tax on dividends. Capital gain taxes are paid in my homecountry
More...

http://greentradertax.com/trader-tax-center/international-tax-matters/

Foreign partners in a U.S. trading partnership can be tax free
If the non-resident is a member of a U.S.-based “pass through” taxable entity — such as a hedge fund or proprietary trading firm — that person is still exempt from effectively connected income. Typically, foreign partners in U.S. partnerships are considered to have U.S. ECI on their Schedule K-1 income. But if the partnership is a trading company — in financial markets, not goods — the income is considered portfolio income, including the partner’s share
 
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