Korean Job Discussion Forums

[cedarseoul]

Hi - I'm a new member, though I've been stalking religiously since I arrived in Seoul early last summer.

I have an American tax-related question I haven't seen answered on these forums, though it's possible I've overlooked it...

I'm aware of the Form 2555 foreign earned income exemption for federal tax which is lauded by all the recruiters, etc. However, I'm wondering about state tax. My wife and I both worked in the States in early 2007 before moving to Seoul, so we need to file state forms. My domicile was/is Michigan, and in Michigan state tax is based off of the adjusted gross income on the 1040, so that will automatically exclude my Korean income...but my wife is domiciled in Pennsylvania, and their state form is set up differently. On face, it looks like I'm technically supposed to include her foreign income along with Stateside income - which I'm not too keen to do, since it will cost me hundreds in state tax.

Has anyone dealt with a situation like this? What do you Americans do when it comes time to file state taxes? Am I missing something here, or do I simply need to suck it up and pay the tax?

I'd appreciate any insight, or links to relevant info...thanks!

[Atavistic]

Some states (I think for sure off the top of my head CA, VA, and NM are included in "some states") make you pay state income tax on foreign earned income. Not sure about Pennsylvania.

Since she's your WIFE, why can't she claim Michigan as her place of residence?

[cedarseoul]

that would make sense, right? but since we left for korea almost immediately after marrying, and since she made no attempt to change her domicile to michigan (no driver license application, no voter reg change, and obviously no property) i'm pretty sure she's still a PA resident.

eh - it's not that much money; we'll cope.

[Atavistic]

[Fresh Prince]

I know a little bit about taxes in the U.S. but this goes way over my head. I'm sure a tax professional would know about things like this though.

I know that a lot of states that tax foreign income also abide by the foreign income exclusion, so if you didn't need to pay federal taxes, then you wouldn't need to pay state taxes. Can't say whether that would apply to you or not though.

[tommy1]

My question is a little different, but maybe you could, please, point me in the right direction. I am also from Michigan and I arrived in Seoul mid-summer 2007. I need some tax help, too.

In the past, paying the taxman was relatively easy, but now I am separated from my tax papers, as I also worked in 2007. Ordinarily, I would've just brought all my tax stuff to a tax professional, but now I am unsure what to do, because all of my paperwork is in the states.

Any help would be appreciated...good luck solving your tax dilemma. All apologies for the thread highjacking.

[Atavistic]

[jaykimf]

[PGF]

Cedarsoul,

go to the US embassy when the IRS (feds) are there to help us (April). The IRS will file your state taxes electronically and for free at the same time you do you fed taxes.

The only exception is if you haven't filed state for several years.....

[santafly]

State income tax is paid in the state in which income is accrued, not the one in which you reside.

For my last 4 years of returns I have been a resident of New Mexico but worked in both Colorado and Utah each year and never in NM. I had to file state taxes for Colorado and Utah but not NM.

Based on this you wouldn't pay any state income tax on your Korean income. I could be wrong though - anything is possible.

[Atavistic]

[KYC]

Hello,

I'm also from Michigan and I came to Korea August 2007. Suppose I have someone forward my documents to Korea, how can I file my taxes? There was one year I did it myself...but I don't really trust myself.

Any advice??

[tired of LA]

[Atavistic]

To back up what I'm saying:

http://www.therealcostarica.com/living_in_costa_rica/paying_us_taxes_expatriate.html

[Atavistic]