Paying US taxes while living overseas
Another $$ post....
Does anyone here have experience paying USA taxes while living & working overseas? The IRS won't give me advice, and these forms are really hard for me to understand. Basically, I work online camming for SM, phonesex with Niteflirt etc, and then I strip overseas where I live. From what I have been reading, it seems different from person to person, but any tips or experiences would be greatly appreciated. The US has a tax treaty with this country I reside in, but I was told by their tax services that I need to find out if I'm "tax reliable" to the USA. I'm also not sure what I qualify for and don't. I know that I have to at least report all of my income to the US, but don't know what country I pay my $$ to. I've talked to a few tax pros, but they weren't much help tbh. :O:D
Re: Paying US taxes while living overseas
oh, and would the money i make webcamming be considered foreign income?
Re: Paying US taxes while living overseas
Foreign tax issues are not easy.
1. If you are a US citizen you are required to report your world wide income earned. That means what is earned in the US or another country.
2. If you are living and earning income in another country they expect you to report and pay taxes on the income earned in their country.
3. If the foreign country you are paying taxes to has a tax treaty with the US you should be able to take a credit against your US taxes for the taxes paid on income earned in that country.
There are a number of rules and regulations that allow you to reduce the amount of income that is taxable in the US when it is earned outside of the US. However these rules and regulation are complex and should be discussed with a tax professional who is familiar with the tax treatment of foreign income on your US tax return.
I suggest you contact several CPAs and/or tax attorneys and ask about their knowledge of foreign taxes. Select the one who you think can help you and then go and discuss your tax question with that individual. When I lived and worked in Europe I had one of the large multinational accounting firms prepare my taxes. I did this, even though I am a CPA and have prepared US tax returns for many years, because of the complexity of taxes and foreign income.
Re: Paying US taxes while living overseas
Quote:
Originally Posted by
zerorg
Foreign tax issues are not easy.
1. If you are a US citizen you are required to report your world wide income earned. That means what is earned in the US or another country.
2. If you are living and earning income in another country they expect you to report and pay taxes on the income earned in their country.
3. If the foreign country you are paying taxes to has a tax treaty with the US you should be able to take a credit against your US taxes for the taxes paid on income earned in that country.
There are a number of rules and regulations that allow you to reduce the amount of income that is taxable in the US when it is earned outside of the US. However these rules and regulation are complex and should be discussed with a tax professional who is familiar with the tax treatment of foreign income on your US tax return.
I suggest you contact several CPAs and/or tax attorneys and ask about their knowledge of foreign taxes. Select the one who you think can help you and then go and discuss your tax question with that individual. When I lived and worked in Europe I had one of the large multinational accounting firms prepare my taxes. I did this, even though I am a CPA and have prepared US tax returns for many years, because of the complexity of taxes and foreign income.
Thanks again for your help. I've been slowly working through this with some help from tax attorneys. *sigh* :O
Re: Paying US taxes while living overseas
The general rule is that unless you have residency in another country, you are NOT released from USA tax obligations.
This is unfortunate indeed ( my non-adult business is fully remote but even when I do extended trips, I calculate my income as USA income since I'm a citizen here and no where else ).
There are loopholes FYI ( such as gaining residency elsewhere ). I'd recommend a tax pro in your country and also a call with one in the USA.
Re: Paying US taxes while living overseas
If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude from income up to an amount of your foreign earnings($100,800 for 2015). That is, if you lived outside the country for more than 180 days. In addition, you can exclude or deduct certain foreign housing amounts. As with any business, you report your camming, phone sex and stripping on Schedule C and take your ordinary and necessary business expenses on Schedule C before coming to your net business income amount. That then is transferred to your Schedule A. Once you have your adjusted gross income on Schedule A, you get to exclude the first $100,800 of foreign source income, if you lived outside the country for more than 180 days. Do go to a U.S. C.P.A. for further advice.
HTH,
Z
Re: Paying US taxes while living overseas
In order to claim the foreign income exclusion or the housing exclusion on your US tax return you must meet the following tests
1. The income must meet the definition of foreign income. Basically income you receive if you are an employee of the US Government living in a foreign country is not foreign income.
2. The foreign country is your tax home
3. You are a US citizen, or if you are a resident alien there are additional test to qualify.
4. Were you a bona fide resident of a foreign country or countries for an uninterrupted period that includes a full tax year. ( this one caused the extension of my 2008 tax return filling until Jan 2010).
5. You were physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.
Re: Paying US taxes while living overseas
I have talked to a new international tax pro today, and have to make a few more calls. I'll post the results when I understand completely and file....just in case anyone ends up in a similar situation! thanks everyone for the advice <3