Category Archives: Taxation

how to report foreign salary

Here’s how to report a foreign salary or international business income. If you earn money from working as an employee or independent contractor, you need to report it on your US tax return. Here’s how to report income paid by a foreign company. I’ll briefly comment on income earned from abroad while living in the

Trump Tax Plan for Expats

Most of Trump’s tax plans will help American expats. If you’re living abroad, and making more than the Foreign Earned Income Exclusion, or have significant capital gains, Trump might cut your US taxes significantly. First, I should point out that there’s been no indication Trump will attack the FEIE. I don’t expect this Exclusion to

subpart f income
01/16/2017 - 4:19 PM
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When a US citizen forms an offshore corporation in a low tax country different from his country of operation, he has a Controlled Foreign Corporation with possible Subpart F income issues. In this article, I’ll review the Subpart F rules and determining factors. First, let’s talk about a Controlled Foreign Corporation. Subpart F only applies

self employment tax

If you’re living abroad and paid by a US company, you’ll pay self employment tax on your earnings. If you’re living offshore and operating a business without an offshore company or LLC, you’ll pay self employment tax on your profits. Here’s how self employment tax works when you’re offshore and how to avoid it. All

Which Countries Tax Worldwide Income?

When you’re planning a move abroad, you need to consider the tax laws of your country of citizenship and your country of residence. The key to a solid expat move is to determine which countries tax worldwide income and avoid them whenever possible. There are four basic tax groupings of countries. I won’t consider the

OECD tax exchange

As of November 2016, most offshore jurisdictions have signed on to the Automatic Exchange Agreements demanded by European governments and the Organisation for Economic Co-operation and Development (OECD). All but Panama has agreed to share information with European tax authorities. On paper, the OECD defines itself as follows: “the mission of the Organisation for Economic

software development

Puerto Rico has the best tax deals available to Americans… period. No offshore jurisdiction can compete with the US territory of Puerto Rico when it comes to cutting your taxes. This post will focus on Puerto Rico’s research and development and intangible property tax breaks. Act 73 is for those who develop licensed or patented

retained earnings

According to the N.Y. Times, The IRS has begun tracking homes bought through offshore companies and shell corporations in the United States. If you’ve setup an offshore structure, and used your retained earnings to buy real estate in the United States, you’re probably a target of the IRS. Even if your offshore company is tax

IRA when you give up US citizenship

Thousands of Americans will turn in their blue passports in the next few months. Some because of our crazy political climate, some to stop paying taxes into a broken system, and some because of FATCA and the international banking laws which make it impossible to live or do business abroad. This post will consider what

Pre-Immigration Tax Planning

If you’re moving the the United States, get ready for our crazy tax system. Most importantly, if you will become a US resident, be prepared for US tax on your worldwide income. You need to do your pre-immigration US tax planning before you arrive to minimize these taxes. Let me begin by defining what I

asset protection puerto rico

Once you have your Act 20 business in Puerto Rico up and running, you need to think about protecting its retained earnings or distributed profits. Asset protection for a Puerto Act 20 business  becomes urgent because of the amount of capital held in the company tax deferred. There are two levels of asset protection for

IRS and panama papers

Do you have a company or bank account in Panama? Are you wondering if you should be worried about the IRS and Panama Papers? Do you know that the searchable database of Mossack Fonseca clients came online today? Is the thought of the IRS knocking on your door keeping you up at night? Let me

Puerto Rico Tax Deal

The Puerto Rico tax deal is the inverse of the Foreign Earned Income Exclusion. Here’s why: With a Puerto Rico tax contract you can live in the US, your first $100,000 or so in salary is taxable, with rest deferred at 4%. If you live offshore and qualify for the FEIE, your first $101,300 is

FBAR Due Date
08/17/2015 - 8:08 PM
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The FBAR due date has been changed from June 30 to April 15. If you file an extension for your personal return, you will have until Oct. 15 to submit your FBAR. Finally the US government has done something which makes sense. This change to the FBAR due date will help new expats big time. Here’s why: