Re: Questions - moving to Frankfurt, Germany from Michigan U

You must be jocking. Living in Germany, working in Germany, how would you not pay taxes? But you should check whether you have to pay US taxes on top of it, because I do not think there is a double taxation agreement.

To give you an idea: tax rate (including national insurance) is just shy of 50 % from a middle class salary upwards in Germany, and your employer has to pay an extra 13 % or so in national insurance contribution. You can combine the allowance of yourself and your wife, plus a small allowance for the children, which should help a bit.

That must be a new currency . 80k Euro would be very decent, even in an expensive area such as Frankfurt. I guess you would get 50k after taxes, although that depends a bit on how many deductions you can reclaim. Renting is cheap in Germany, so in the outskirts of Frankfurt you should be able to get a 3 bedroom apartment for 1000 Euro per month. Buying is expensive, so it may not be worth it for a few years.

A car can be maintained for about 1000 Euro a year plus depreciation, but of course petrol is very expensive compared to what you are used to. I would be more worried about school for your son. He can go to a state school (although quality differs a lot in Frankfurt), but be prepared for difficulties with the language gap (The German school system is good, but not very flexible.) It might be a good idea if he starts learning German ASAP.

PS: I wonder whether you want to ask this question in the forum for "Working and Studying". I can move the thread if you like. [/quote]

 

Re: Questions - moving to Frankfurt, Germany from Michigan U

I used to live in Frankfurt - nice city!

If you are paid through an American company then you may be able to avoid entering the German tax/healthcare system. Reciprocal schemes do exist. Check with the company accountant before you leave. You may also want to get in touch with a German tax accountant as well - google for an English-speaking one.

€80,000 is a very reasonable wage and will keep you comfortably, even if you have to enter the German tax system.

Few hints:
1) Rent, don't buy, an apartment. The German property market does not move quickly and you may find yourself lumbered with a place you can't sell when you finish your contract. Most Germans in cities rent apartments. Houses are rather harder to come by.
2) Frankfurt has great public transport. Don't get a car unless you really need to. Do get a couple of driving lessons (I know it dents the pride a bit). German roadsigns are ISO, not US standard, and they have a couple of odd rules about priority that will take you by surprise.
3) There are English-speaking international schools in Frankfurt - including ones following the US school system. You can find several on google or shop around when you get there.
4) If you go drinking in Sachsenhausen, don't forget where you live

 

Re: Thanks for the two great VERY HELPFUL replies

The move to "departure" lost me

I've asked but none of my family or friends still in Germany makes use of English-speaking schools, having kids entered into the German system, kids that have grown up or kids that aren't yet old enough to talk.

In Germany furnished apartments exist but are quite rare. The definition of "furnished" and "unfurnished" is pretty much the same as the rest of the world, except:
* you might have to take some light fittings. Last place I lived, when I moved in there were just bare wires poking from the ceiling.
* you might have to have a kitchen fitted. The kitchen is tenant-supplied in many apartments. You should clarify that as you look around and check what it says on the contract.
* remember that on moving out you are obliged to restore the apartment to its original condition. That means professional cleaning of carpets, painting of all walls white and removal of anything you've installed.

Just teasing - FFm is a jumping-off point for a lot of American squaddies on their way to or from a certain middle-eastern warzone. Naturally they celebrate their last or first taste of civilisation for a while... Best thing, though, is to pick up enough German to direct a taxi driver to deliver you home - a lot of taxi drivers are foreigners, speak their language or German and no English.

Bear in mind that the cost of living converter assumes a full migration, including entry into the local tax system. Best not to use it until you've reassessed your tax situation. In any case, if you're currently on US$160kpa, then €80kpa represents a pay cut in terms of straight currency conversion - in straight money, €112kpa would be parity.

 

If you do move to Germany, and assuming you do pay German income taxes (very likely), then do not assume that it is in your interest to use the "foreign earned income exclusion" (Form 2555) on your US return. With 2 children, and an income level of approx 80,000 EUR it is likely that the Form 2555 will be a bad idea for you, and you should use only the foreign tax credit (Form 1116). You would be well advised to contact a US tax professional who specializes in US expatriate taxes. I am one such person, but if you want to work with someone in Germany, I can refer you to someone there.

 

check your PM's -- Edelman