How Roth IRA Withholding Tax Credits Work Abroad

Lucas and Luna explore a tricky corner of Roth IRA strategy: how U.S. citizens living abroad can use foreign tax credits to offset the tax on a Roth conversion. They walk through the case of an American engineer in Germany who converted $50,000 from a traditional IRA to a Roth IRA in 2025—and how foreign tax credits saved her nearly $6,000. The episode covers the Form 1116 mechanics, the sourcing rules for pension income, and why the foreign earned income exclusion can backfire. If you're an expat with a Roth IRA, this is the nuance most advisors miss. #RothIRA #ForeignTaxCredit #ExpatFinance #RothConversion #Form1116 #TaxStrategy #USExpats #RetirementPlanning #Finance #FexingoBusiness #BusinessPodcast #OverseasAmericans #TaxEfficient #PassiveIncome #IRA #Germany #TaxTreaty #PersonalFinance Keep every episode free: buymeacoffee.com/fexingo