Job Discussion Forums

moonpie · Joined: 30 May 2003 Posts: 71

Is it true that we can be taxed on our Saudi income if we spend more than thirty consecutive days in the United States.

007 · Posted: Sat May 29, 2010 11:46 am Post subject:

Well, as far as I know, any American citizen residing abroad has to pay Uncle Sam taxes on his international income. Also, according to Uncle Sam rules, it is against the US laws to give up your US citizenship to escape Uncle Sam taxes! Laughing

So, regardless if you spend 30 days or not in the USA, Uncle Sam wants you to pay your taxes as any US citizen living and working abroad.

Never Ceased To Be Amazed · Posted: Sat May 29, 2010 12:06 pm Post subject:

The kitty-cat is sooo very wrong. As is his usual mission, he seeks to confound. When living abroad you must meet either on of two "tests": Physical Presence or Bona-fide Residence. It goes by 12 CALENDAR months NOT annual increments.

If you live abroad for a year, you meet the Bona-fide Residence test. The gist of the tests is for someone one with a 3-6-9 month foreign assignment avoid paying taxes. If you live abroad...then you live abroad.

The only thing that you MUST do is report yer income annually and as long as it doesn't exceed the ever-rising exemption (and, being on a teacher's board...it decidedly does not) you won't be liable for taxes.

But...(isn't there ALWAYS a "but"), that doesn't count towards STATE taxation. Luckily, my state works offa what the Feds get...yer state may not. Something to look into and consider...

Hope this helps...

NCTBA

Sheikh N Bake · Joined: 26 Apr 2007 Posts: 1307 Location: Dis ting of ours

Sheikh N Bake · Joined: 26 Apr 2007 Posts: 1307 Location: Dis ting of ours

veiledsentiments · Joined: 20 Feb 2003 Posts: 17644 Location: USA

You don't need to pay someone that kind of money to do your taxes. All you need is a basic Turbo-Tax or Tax-Cut (or whatever H&R block calls it these days) and the ability to read directions on the program - or go and read the rules which are all now easily accessible on the IRS website.

The first year can be a bit tricky since we teachers usually end up starting in August or first year abroad. For that 4-5 months, you will need to file a form called the 2350 - a special extension that lets you file your return for that year at the end of your first 12 months. You will have had to pay all the taxes due on any earnings from Jan-Aug in the US. (uncle always wants his money even though he will let your file that first return late so that you don't have to pay on Aug-Dec.) Then the next year(s) you are under normal rules covered under form 2555 (foreign earned income and bonafide resident) and there are no restrictions as to number of days in the US.

And as SnB says, your last year overseas can be prorated if say you return to the US in June as is usual.

BTW... as far as I know, the states tax only the income taxable on the 1040 thus excluding the overseas income. But, there may be exceptions, so be sure to check your own state tax laws. You do have to pay taxes on any income that you have in the US from investments... both federal and state.

And... a little quirk in the law that many don't know about is that if you do private lessons outside your main job, that money is fully taxable... including for Social Security where you pay about 15%. Shocked

I've always wondered how many people actually comply with this... very few I expect.

VS

Never Ceased To Be Amazed · Posted: Sat May 29, 2010 3:27 pm Post subject:

Does Turbo Tax and the H&R Block product now recognize the 2555? Back in the day it wuz useless to me so I haven't bought a copy since. If so, I may reconsider...

NCTBA

scot47 · Joined: 10 Jan 2003 Posts: 15343

I warned you all, "Do not trust felines."

I Rub Ruchi · Joined: 23 Jun 2008 Posts: 45 Location: USA

I am very sure you can find a better response to your question from another website.

scot47 · Joined: 10 Jan 2003 Posts: 15343

You should be proud to pay taxes to Uncle Sam to fund these wars to keep the world FREE !

(IRONY ALERT. THIS POST IS NOT TO BE TAKEN SERIOUSLY)

007 · Posted: Sat May 29, 2010 6:43 pm Post subject:

Well, it seems Uncle Sam has to use the taxpayers money to clean the beaches of USA from the oil spill caused by BP disaster!

Any American citizen who has $10,000 or more in a bank in the Magic Kingdom must report that bank to Uncle Sam and the IRS or face penalty and prosecution!
If you want to take advantage of the foreign tax credit, form 1116 should be filled.

veiledsentiments · Joined: 20 Feb 2003 Posts: 17644 Location: USA

I used Turbo Tax for years and it did the 2555 and has always done so as far as I know. You need to be careful how you answer the questions. But the 2555 has always been in their file and you could do it from a pull down menu. You have the option of filling numbers directly onto the forms rather than using the 100 questions. Laughing

The last couple years I switched to HRBlock's program (because TT tried to gouge everyone last year and then only allow you to do one return from each program) and it seemed easier.

VS

Never Ceased To Be Amazed · Posted: Sun May 30, 2010 2:23 am Post subject:

The kitty know ABSOLUTELY NOTHING of which he mews...

If you take $10,000 or more into the U.S., it must be DECLARED. Nothing more...nothing less...

NCTBA

veiledsentiments · Joined: 20 Feb 2003 Posts: 17644 Location: USA

scot47 · Joined: 10 Jan 2003 Posts: 15343

Our resident Oklahoman is quite concerned that the Federal Authorities in the District of Columbia require him to inform them of how much money he has in his bank accounts here.

This is, according to many observers, clear evidence that the Federal Government is run by a gang of communists and reds.

I keep my live savings in specie in a tin box buried in my garden. The French peasantry who keep their wealth in Lous d'Or are not foolish !