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Attention all Americans: taxes explained...
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tonyvu



Joined: 30 May 2008
Location: busan - a view of dadaepo beach from my office window

PostPosted: Wed Mar 03, 2010 7:16 am    Post subject: Reply with quote

aside from the presence/bonafide tests and income requirement, what would be a reason the IRS would deny me the exemption (assuming i have the certificate)?
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tonyvu



Joined: 30 May 2008
Location: busan - a view of dadaepo beach from my office window

PostPosted: Wed Mar 03, 2010 8:20 am    Post subject: Reply with quote

also found this from another post:

http://www.irs.gov/pub/irs-trty/korea.pdf
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persephone



Joined: 23 Feb 2010
Location: France

PostPosted: Wed Mar 03, 2010 10:50 am    Post subject: Reply with quote

Konglishman wrote:
amberflannery wrote:
i only worked here in korea last year. i was going to fill out the 1040 and the 2555. thats wrong? Question Question Confused


Well, keep in mind that I am not a tax expert. Anyways, it is only the 2555 that is relevant for foreign income. So, unless you worked in the US for part of last year or have some other type of income derived from the US, I do not see why you would be filling out the 1040.


The 1040 has to be filed with the 2555. You just write the amount in parentheses that you earned while working abroad. Then you write zero everwhere else. You won't have to pay any taxes, but you do have to fill out the form.
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Konglishman



Joined: 14 Sep 2007
Location: Nanjing

PostPosted: Fri Mar 05, 2010 10:18 pm    Post subject: Reply with quote

persephone wrote:
Konglishman wrote:
amberflannery wrote:
i only worked here in korea last year. i was going to fill out the 1040 and the 2555. thats wrong? Question Question Confused


Well, keep in mind that I am not a tax expert. Anyways, it is only the 2555 that is relevant for foreign income. So, unless you worked in the US for part of last year or have some other type of income derived from the US, I do not see why you would be filling out the 1040.


The 1040 has to be filed with the 2555. You just write the amount in parentheses that you earned while working abroad. Then you write zero everwhere else. You won't have to pay any taxes, but you do have to fill out the form.


I see. I guess that is what I get for using Turbotax which figures those sorts of things out for you.
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Konglishman



Joined: 14 Sep 2007
Location: Nanjing

PostPosted: Sat Mar 06, 2010 12:10 am    Post subject: Reply with quote

Incidentally, with regards to the 2 year exemption from Korean taxes, I found out something new a few days ago.

First of all, once you get the exemption, you cannot get it again even if you go back to the U.S. for a few years to work. Secondly, if you have already worked for 2 years in Korea without the tax exemption, then you are ineligible to get it in the future. However, if you have only worked in Korea for a year without the tax exemption, then you can qualify for a 1 year tax exemption assuming, of course, that you take a new job at a public school or university.

At least, this is what one of the administrative people at my workplace, tells me. He seems like a fairly reliable and knowledgeable person. So, I think that what he says is correct. But then again, I can easily imagine a scenario in which people who were unsure of the exact regulations, gave him incorrect information. So, it would be nice if someone else on this forum could confirm what I have been told.

Its just too bad that I have wasted money applying for the Certificate of Residency as I have already previously worked in Korea for 2 years.
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Konglishman



Joined: 14 Sep 2007
Location: Nanjing

PostPosted: Sat Mar 06, 2010 12:21 am    Post subject: Reply with quote

tonyvu wrote:
aside from the presence/bonafide tests and income requirement, what would be a reason the IRS would deny me the exemption (assuming i have the certificate)?


That is up for Korea to decide, not the IRS. The IRS's only part in this is whether or not they decide to give you the Certificate of Residency. After that, it is up to the Korean authorities to decide whether or not you actually qualify for the 2 year Korean income tax exemption. Basically, the Korean Income Tax treaty tells about the tie breaking provisions as well as the fact that you need to work at either a public school or university in order to qualify. Finally, you should take note of my previous post.
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naturegirl321



Joined: 18 Jul 2006
Location: Home sweet home

PostPosted: Sat Apr 03, 2010 6:28 pm    Post subject: Reply with quote

I just got my reply back from the US. They didn't give me the cert. They said that unless I sign an affidavit swearing that I was a US resident for tax purposes, which I wasn't, they won't give me the cert.

So. . it seems like if you WERE in the US and didn't file the 2555 for the tax year, then you will get the paper from the IRS:

If you're like me and filed the 2555, then the IRS will NOT give you the paper, UNLESS you sign an affidavit swearing that you WERE a US tax resident. I think this would be for peopel like the military, or people who worked for US companies abroad.

If anyone wants, I'd be happy to email you the scan of the reply from the IRS.
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Konglishman



Joined: 14 Sep 2007
Location: Nanjing

PostPosted: Sat Apr 03, 2010 7:02 pm    Post subject: Reply with quote

naturegirl321 wrote:
I just got my reply back from the US. They didn't give me the cert. They said that unless I sign an affidavit swearing that I was a US resident for tax purposes, which I wasn't, they won't give me the cert.

So. . it seems like if you WERE in the US and didn't file the 2555 for the tax year, then you will get the paper from the IRS:

If you're like me and filed the 2555, then the IRS will NOT give you the paper, UNLESS you sign an affidavit swearing that you WERE a US tax resident. I think this would be for peopel like the military, or people who worked for US companies abroad.

If anyone wants, I'd be happy to email you the scan of the reply from the IRS.


My understanding was that as a citizen, you are automatically considered a U.S. tax resident, but it is really a question of whether or not you have strong enough ties to the U.S. if you filed 2555. Anyways, I have a bit of a headache right now. So, I will have to think about this later. Anyways, I am sorry to hear that you are having trouble with this.

On my end, I heard recently that the IRS acknowledged receiving my application. I was told that they would make a final decision around the end of April.

And of course, I still need to confirm whether or not I really am disqualified from the Korean tax exemption.
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naturegirl321



Joined: 18 Jul 2006
Location: Home sweet home

PostPosted: Sat Apr 03, 2010 7:11 pm    Post subject: Reply with quote

Konglishman wrote:
My understanding was that as a citizen, you are automatically considered a U.S. tax resident, but it is really a question of whether or not you have strong enough ties to the U.S. if you filed 2555. Anyways, I have a bit of a headache right now. So, I will have to think about this later. Anyways, I am sorry to hear that you are having trouble with this.

On my end, I heard recently that the IRS acknowledged receiving my application. I was told that they would make a final decision around the end of April.

And of course, I still need to confirm whether or not I really am disqualified from the Korean tax exemption.


Ok, first, I got my acknowledgement about two weeks ago. Which is odd, because I htink you filed in Jan, right? I filed in April. Is your IRS cert going to be sent to a US or Korean address? You should get your answer soon. Hope it's not the same as mine.

i sent them copies of my driver's license, ID card, bills with my US address, and library card. They sent this as a response:
. . . for purposes of taxation are US residents and will remain so for throughout the current tax year.

I wont' I filled a 2555 last year and have since 2003.

Look at all the stuff that I sent them. It wasn't accepted. My taxes were only about 180 bucks, compared to the 400 bucsk I was paying in Peru, that's ok. I've also heard that if I use my Korean credit card, I can get the taxes back at the end of the year. So I think I'll do that.

honestly, paying taxes DOES stink, but in a way, it's worth it. The public works, infrastructure, etc are good here. I'd rather pay Korean taxes than US ones. Espeiclaly since I live and work in Korea.
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arrangingpieces



Joined: 08 Aug 2009

PostPosted: Mon Apr 26, 2010 7:31 pm    Post subject: Reply with quote

does anyone know if it's possible to provide the residency certificate at the end of the year and have these taxes refunded to you as it was too late for me to give it at the beginning?

i've heard it's possible but i don't have confirmation of that...

i work at a public high school.

thanks!
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naturegirl321



Joined: 18 Jul 2006
Location: Home sweet home

PostPosted: Mon Apr 26, 2010 9:01 pm    Post subject: Reply with quote

arrangingpieces wrote:
does anyone know if it's possible to provide the residency certificate at the end of the year and have these taxes refunded to you as it was too late for me to give it at the beginning?

i've heard it's possible but i don't have confirmation of that...

i work at a public high school.

thanks!


MIght as well try. I just sent my res cert in. My dad says if I get audited, etc, tell them their rules are WAY too confusing.
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You



Joined: 31 May 2009

PostPosted: Mon Apr 26, 2010 9:40 pm    Post subject: Reply with quote

I got a letter saying I needed to sign my name stating I was a US citizen...is this a special form I need to sign or do I just write a letter myself and sign it?

If there is a special form, where do I find it?
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naturegirl321



Joined: 18 Jul 2006
Location: Home sweet home

PostPosted: Mon Apr 26, 2010 11:38 pm    Post subject: Reply with quote

You wrote:
I got a letter saying I needed to sign my name stating I was a US citizen...is this a special form I need to sign or do I just write a letter myself and sign it?

If there is a special form, where do I find it?


I got the same letter, but it says that you have to state that I was a US resident. Just write a letter with the same expression they use, sign it and send it to them.
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You



Joined: 31 May 2009

PostPosted: Tue Apr 27, 2010 12:21 am    Post subject: Reply with quote

Okay, thanks so much!
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naturegirl321



Joined: 18 Jul 2006
Location: Home sweet home

PostPosted: Tue Jun 22, 2010 3:39 am    Post subject: Reply with quote

Sorry for not updating this thread sooner. After filling out the IRS form, can't remember which one, I was snet a letter saying that I had to write another letter saying that I was a US tax resident, which I had written in the first letter.

Since I had paid 58 bucks last year, I decided to write the l,etter. My dad said if they gave it to me, despite the fact that I had filed the 2555 for nearly a decade, than that would mean there was some type of loophole or that the rules were so confusing that even the IRS peopel couldn't understand.

So I wrote the letter, again, and got a certificate saying that I'm a US tax resident.

Here's the thing, I can NO longer file the 2555EZ, becuase there's a section that says that you can't file it if you told the foreign govt where you're living that you're not a tax resident. I CAN file the 2555 normal, long form, AND get out of Korean AND American taxes, provided that I'm outside of the US for 330 days or more each year. Which I will be. Gott love loopholes!
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