Tax Advantages in the US
The tax table refers to 2012 tax year:
|Income type||Tax rate in Israel||Tax rate in the US||Your gain as a US citizen||appendix|
|Capital gain from marketable securities
Short term (held less than a year): taxed as Ordinary income
Long term (held less than a year): taxed at :0%-20%
|If your taxable income is less than 85650$ your tax rate will be lower than 25%.
Please note: up until 9750$ of income you have a zero tax liability if you file as single (19500$ for married filing jointly). After that up until 8700$ your tax rate will be only 10%.
|Capital gain tax rate in the US|
|Dividends||25%|| Qualified dividends
Ordinary dividends: taxed as Ordinary income
|See remark for Capital gain||Dividends in the US|
|Interest|| Indexed interest– 25%
non Indexed interest– 15%
| Ordinary interest: taxed on your Ordinary income
Tax exempt interest – 0%
|For taxable income under 35350$ the tax rate will be under 15%.
On tax exempt interest you have no tax liability.
|Interest tax rate in the US|
|Capital gain on property sale||0%-50%
Depending on the date of acquisition
|0%-20% for long term Capital gain||In most cases the tax rate in the US on capital gain will be lower than the one in ISRAEL.
Please note that both in ISRAEL and the US you can exclude part or all of your capital gain if you meet certain requirements
|Capital gain on property sale in the US|
|Acquisition tax|| Single family residence:
1. up to 1,350,000 NIS: 0.0%
2. from1,350,000 –
1,601,210 NIS: 3.5%
3. Above 1,601,210 NIS: 5%
|0%||All Acquisition tax paid in Israel can be “saved” by buying the property in the US.||No Acquisition tax
In the US.
| Most Social security payments are tax exempt in ISRAEL (For example: old-age pension claim)
Please note there are several payments that are taxable. For example: Unemployment compensation and maternity benefits.
|A US citizen residing in ISRAEL is tax exempt on social security benefits received From Israel or US social security in accordance with the tax treaty article 21.||All social security payments can be exempt from tax under the tax treaty.||Israel-US tax treaty|
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Tax Advantages in the US and Israel
Basic Tax Terms
Tax Advantages in the US
Tax Advantages in ISRAEL
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