Saturday, April 5, 2008

Torn between two Countries

Looking at our tax bill here in Germany recently made us realize that we are torn between our two countries --> our home in America, and our current home in Germany.

The watered down version of our conversation:
Honey do you realize that we pay in
Germany = roughly 20% of our income in taxes
America = < 2% of our income in taxes

Why did we pay lower taxes in America? Because we owned a house and could deduct the interest paid on the mortgage from our taxes.

Conclusion: buy a house in Germany and save a huge pile of cash each year.

Yea, but wait a minute, wouldn't that mean we are staying here (in Germany) for a long time? Can we sell a house again? This is naturally possible, but would we sell said house with a loss, with a gain? What are the up front costs, upkeep, would our mortgage be lower than our current rent? Lions, and tigers, and bears, Oh my.

Final conclusion: which country do we really want?

Reality check from dad a few days later. He is replacing his water heater (I told him about all the benefits of oil heating - just kidding) and may require major repairs to a skylight - ouch!

Maybe a tax adviser would be a simpler alternative. No matter what we decide, the fundamental question remains - which country do we want. We have chosen Germany for the time being. Will we want that same country in 5 years, 10 years, etc.? Lions, and tigers, and bears, Oh my.


Maria said...

I don't know about you, but while in Germany, we paid more and receive more (public health insurance, etc). Not to mention that "solidarity tax" to help out the former East Germany. We use an accountant there...and here...and everywhere!

Gardner said...

Yea it's sad that money forced us to ask ourselves the question - what shall we do with our lives? But that was what prompted the conversation.

March 2007