Visa holders · From Australia
If you are moving to the US from Australia, taxes on superannuation are the open question, since the IRS has not classified it.
Unless you were a temporary resident, Australia treats your shares and managed funds as sold at market value when your residency ends. You can choose to defer that tax instead. If you pay it, Treasury reads Article 13(5) of the treaty as letting you set your US basis at that market value.
Updated · Sources
What the treaty gives a US resident
- 10%
- caps the tax Australia may charge on Australian interest paid to you.
- 15%
- caps Australian tax on the dividends you receive from Australian companies.
- 0%
- of an Australian Age Pension is taxed by the US. Article 18(2) leaves it to Australia.
Article 22 requires the US to credit Australian income tax against US tax, within US limits.
Does Australia tax a deemed sale when you leave?
Australia taxes you on CGT event I1, its deemed sale on leaving, only when all four of these hold.
Your Australian residency has ended
The ATO first asks whether you still reside in Australia. If you no longer do, the domicile test comes next. It can keep you resident until the ATO accepts that your permanent place of abode, your settled home, is abroad.
You were not a temporary resident
A temporary resident is not treated as selling anything on leaving. Broadly, that status needs a temporary visa, and neither you nor your spouse can be an Australian citizen or permanent resident.
The asset is not taxable Australian property
Australian real estate and other taxable Australian property stay out of the deemed sale. Australia taxes the gain when you actually sell, wherever you then live.
You did not choose to defer
You can choose to disregard all your gains and losses on leaving. You make that choice in the way you prepare your Australian return. Those assets are then treated as taxable Australian property until you sell them or become a resident again.
The deemed sale reaches assets held anywhere, so US shares you already own are caught too.
Without the Article 13(5) election, both countries count the same $60,000 of gain.
Taxed on leaving, no election
$135,000
Australia counts $60,000 as you leave, and the US counts $75,000 from your $25,000 cost.
Taxed on leaving, with the election
$75,000
Australia counts the same $60,000, and the US counts only the $15,000 above $85,000.
Deferred on leaving
$75,000
Australia counts nothing as you leave, and Article 13(6) leaves the whole $75,000 to the US.
Each figure adds Australia’s gross gain on leaving, before any CGT discount, to the US gain on the sale. The real gain is $75,000 in every path. All amounts are in US dollars, with exchange rates left out. Your Australian residency is assumed to end before your US residency starts. Treasury’s technical explanation of the 2001 protocol describes the Article 13(5) and 13(6) results. The cheaper path turns on each country’s rates, and no rate is applied here.
Five US filing mistakes to avoid after moving from Australia to the US.
Keeping Australian ETFs after the move
Managed funds and ETFs based in Australia usually meet the US test for a passive foreign investment company (PFIC). Without a QEF (qualified electing fund) or mark-to-market election, a gain or excess distribution is spread over your holding period. The share for earlier years is taxed at the top rate, plus interest. Form 8621 is usually due for each fund.
Assuming super is exempt from Form 3520
Rev. Proc. 2020-17 frees some foreign retirement trusts from Forms 3520 and 3520-A. Among other conditions, contributions must be capped and come only from earned income. Super, though, takes after-tax contributions from any savings, up to a yearly cap of A$130,000 for 2026-27. So whether super qualifies is unresolved.
Reporting only your bank accounts
Brokerage and fund accounts go on the FBAR with your bank accounts. You file it once your foreign accounts total over $10,000 at any time in the year. Its retirement plan exemption covers only US plans, such as a 401(k) or an IRA, so super may belong on it too. Form 8938 also counts foreign pensions such as super. A single filer in the US files it with more than $50,000 abroad at year end, or $75,000 at any point.
Skipping Form 3520 for a large gift from home
A gift from family in Australia is not US income. Gifts over $100,000 in a year from a nonresident alien, counted together with gifts from their relatives, go on Form 3520. A late report can cost up to 25% of the gift. For a parent in Australia, giving you shares is a CGT event, priced at market value under Australian law.
Paying US Social Security on a posting from Australia
A temporary posting from an Australian employer, such as an L-1 transfer, can keep your pay out of US Social Security contributions. Your employer asks the ATO for a certificate of coverage under the US-Australia totalization agreement, in force since October 1, 2002. The exemption generally covers assignments expected to last 5 years or less.
We keep your US returns in step with the Australian return your tax agent lodges.
Valim is a CPA firm that takes on your US returns in the year you arrive from Australia and every year after.
- We fix your US residency start date from your travel dates or green card. On Form 1116, we claim a credit for the Australian tax on your interest, dividends and rent.
- We model the US tax on a later sale both ways: paying Australia’s tax on leaving, or deferring it. You see both results before the choice is made on your Australian return.
- We file your FBAR and any Form 8938 due, plus Form 8621 for each Australian fund or ETF that requires it. The instant quote counts your Australian accounts and funds, so your fee reflects them.
- We plan estimated payments on income you still earn in Australia.
- If an IRS or state notice arrives on a return we prepared, even about your Article 13(5) basis, our reply costs nothing extra.
- Individual return
- from $195
- Business return
- from $495
We quote a flat fee before work starts. We do not bill hourly.
What people leaving Australia ask about US tax.
What is the 10 year tax rule in Australia?
The 10 year rule is how Australia taxes bonuses from life insurance policies and friendly society bonds, often called investment bonds. A bonus counts as Australian income only if you receive it within 10 years of the policy’s start. All of it counts in years 1 to 8, two-thirds in year 9 and one-third in year 10. Paying more than 125% of the previous year’s premium restarts the 10 years. US tax law has no matching rule, so a bond you keep needs its own US analysis. Americans living in Australia face the same gap.
Does Australia have a tax treaty with the US?
Yes, and for a new US resident its main gift is the Article 13(5) basis election. It also caps Australia’s tax on your interest at 10% and on dividends at 15%. The saving clause, Article 1(3), otherwise lets the US tax you as if the treaty were not in force. Its exceptions still apply, including Article 18(2) on public pensions and Article 22 on double taxation. The treaty dates from 1982, with a 2001 protocol.
How much is $100,000 a year taxed in Australia?
For 2026-27, A$100,000 of taxable income costs an Australian resident A$22,520 before tax offsets, Australia’s credits against tax. That is A$20,520 of income tax plus the 2% Medicare levy of A$2,000. The income tax is nil on the first A$18,200, 15% on the next A$26,800 and 30% on the A$55,000 above A$45,000. For 2025-26 the second rate was 16%, which made the total A$22,788. Once you are a foreign resident, Australia taxes only your Australian-source income, such as rent from your old home. Its capital gains tax then reaches only taxable Australian property.
How is superannuation taxed in the US?
Superannuation has no settled US tax treatment, because the IRS has not said which kind of account super is. No article of the US-Australia treaty defers US tax on what super earns. Without a treaty deferral, funds held inside your super may need their own Form 8621. Choose one reporting position on super for your US return, and apply it the same way each year.
Are E-3 visa holders taxed as US residents?
Usually, yes, because E-3 days count in full toward the substantial presence test. The E-3, open only to Australians, is not one of the exempt categories. Those cover students, teachers, trainees, foreign government staff and some professional athletes. If you land by July 2 and stay through December, you reach 183 US days in your first year. That year is usually dual-status: nonresident before your first day in the US, and resident from that day. A spouse on an E-3 dependent visa may work here and is tested on their own days.
Sources
- US-Australia income tax convention (1982)
- Protocol to the US-Australia convention (2001)
- US Treasury, Technical Explanation of the 2001 protocol to the US-Australia convention
- Australian Taxation Office, how changing residency affects CGT
- Australian Taxation Office, your tax residency
- Australian Taxation Office, tax rates for Australian residents
- Australian Taxation Office, contributions caps
- Australian Taxation Office, 2025 instructions on life insurance and friendly society bonuses
- IRS, Rev. Proc. 2020-17 (exemption for tax-favored foreign trusts)
- IRS, Instructions for Form 3520 (Rev. December 2025)
- 26 U.S.C. § 1297, Passive foreign investment company
- IRS, Instructions for Form 8938
- 31 C.F.R. § 1010.350, Reports of foreign financial accounts (FBAR)
- 26 U.S.C. § 7701(b), Definition of resident alien and nonresident alien
- USCIS, E-3 specialty occupation workers from Australia
- US Social Security Administration, the US-Australia totalization agreement
Reviewed and updated September 2026. General information, not advice for your situation.