On 11/09/2010 12:35 PM, XXXXX wrote:
David; XXXXX suggested that you might be able to answer the question below. Would appreciate your comments on this. XXXXXX Subject: Re: Deductions I am not sure about that. That is a good question to ask David Ingram. On Sep 11, 2010, at 11:57 AM, XCXXXXX wrote:
In your letter today, you said this fellow would have a $92,000+ deduction against his SS, annuity and Interest/dividends. I was under the impression that the foreign residency deduction was only usable against earned income not investment income. If that is so, then the fellow would not have to pay Ecuador tax, but still would have to pay US income tax on his unearned income. Is this incorrect?
david ingram replies:
I am walking into the middle of something without the whole question.
However I will wade in.
Ecuador taxes "assessable" which income includes business income, employment income,
certain capital gains, rent and interest.
Deductions include interest and other expenses paid in gaining the assessable income
and gifts to some specified bodies.
The Tax rate is progressive from 5 to 35%.
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