Meghan Markle marrying into the royal family was a joyous occasion, but come tax season, her U.S. citizenship could lead to what one aide is calling “the royal household’s worst nightmare,” detailed The Sun. Even though Meghan is living abroad, it doesn’t mean that she’s exempt from paying taxes. This means that she needs to report income which is “available” to her. And that’s not limited to her own wealth estimated at around $5 million, but it could affect Prince Harry’s trust fund of around £300,000 a year.
Moreover, it looks like the income that’s “available” to the duchess might include her jewelry, travel expenses, and accommodations. As if that’s not enough to cause a tax headache, it looks like the IRS could look into Prince Charles’ and the queen’s wealth, since they give funds to the couple.
While taxes aren’t due until mid-April, it looks like the royal officials are getting a jump start by hiring a U.S. financial consultancy firm. And that sounds like a good idea, considering that the guidelines from the IRS are somewhat vague, stating that “You are generally taxed on income available to you, regardless of whether it is in your possession.”
And if the IRS does audit the royal family, it could be a giant headache for them, described an aide.
“We’re looking at a level of financial exposure the Royal Family has never had to face before. It’s the royal household’s worst nightmare.”
The idea of the royal family paying taxes might seem like an ironic twist, considering that the monarchy is tax-exempt in their country. The family receives around $368 million every year from their country, of which around $48 million is provided by the British government, according to Insider.
Some of the funds come from the Sovereign Grant, which includes money from British taxpayers along with 15 percent of the Crown Estate’s profits. The estates are a portfolio of properties that are owned by the monarchy. This even includes property that’s being used as a wind farm, detailed the BBC. The rest of the profits from the estates are given to the public treasury. And last year, each British taxpayer paid about 69 pence toward the monarchy, described Vanity Fair.
Meghan Markle and Prince Harry facing 'tax nightmare' https://t.co/6xVNrUjcsL— Katie Timms (@KatieTimms94) November 18, 2018
It’s hard to know right now how the tax season will pan out for the royals at this point. The experts will likely have some good advice for the monarchy, and at the very least, they still have some months to go before the filings are due.