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gotte00
Joined: 18 Jan 2003
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 Posted: Wed Feb 04, 2009 3:57 am Post subject: filing taxes in the u.s. |
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| been here for the last 6 years and haven't filed or paid taxes in the u.s. in that time. what penalty will i be facing upon return in a few months? does anyone have any info regarding this? |
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Missihippi
Joined: 22 Oct 2007
Location: Gwangmyeong
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| Posted: Wed Feb 04, 2009 6:26 am Post subject: |
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| Holy $hit..you just became my hero. I'd like to know as well what you will have to do. |
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mole
Joined: 06 Feb 2003
Location: Act III
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| Posted: Wed Feb 04, 2009 8:50 am Post subject: |
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I did the same, got caught up in Korean fantasyland and overlooked filing US taxes for a few years.
Aside from any anxiety, it's really a simple task to get back in the system and caught up.
Keep in mind it will be tedious and frustrating and you'll have mounds of paper to keep track of, but
Think Nike and Just Do It.
I just decided it needed to be done and proceeded thusly:
1. I called the IRS, though I suppose you can do it online, and ordered all necessary forms and their accompanying instructions for the years unfiled.
Use whichever 1040 you've used in the past and 2555-EZ Foreign Earned Income Exclusion.
2. Even you'll feel like it would save time otherwise, I recommend doing it sequentially, starting with the oldest.
Unless you arrived in Korea in a January, as I did, either your first or last year won't qualify for the exclusion, based on number of days in the year you were physically out of the country.
3. If you have paystubs, use them and file them for possible audit later, but they're not necessary.
Add up what you made working your job sponsoring your visa, any housing allowance, and estimate the value of any provided housing IN KRW.
I was anal about these estimates, but unless you're close to the $70,000/annum (varies) Max exclusion, it REALLY doesn't matter. Just make a good faith estimate you are comfortable with.
The irs.gov website has archived Annual Average Exchange rates. Use these to convert your earnings to USD.
4. Fill in your 1040 per instructions. You may have capital gains, rental income or other income sources. Just proceed as normal attaching any required schedules (ie. Schedule D - Capital gain/loss.)
Unless you are independently wealthy, your bottom line after all this stress will be ZERO.
5. Continue with remaining years, stuff 'em all in an envelope and mail it off. You are finished. IRS will let you know if there is a problem.
NO, there is no automatic penalty based on the fact that you're doing this late. I filed 7 back years' worth in one envelope.
IF you end up owing back taxes, they will try to add on interest (no penalty or fine,) but remember, federal income tax is unconstitutional and illegal anyway, so appeal it.
They will settle for some small portion of what they "demand" at first. It's all posturing.
I've written a book here, and far more than was asked. Got carried away.
Good luck and feel free to ask for clarification. |
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Jati
Joined: 13 Dec 2008
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| Posted: Wed Feb 04, 2009 11:56 pm Post subject: |
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| mole wrote: |
1. I called the IRS, though I suppose you can do it online, and ordered all necessary forms and their accompanying instructions for the years unfiled.
Use whichever 1040 you've used in the past and 2555-EZ Foreign Earned Income Exclusion.
2. Even you'll feel like it would save time otherwise, I recommend doing it sequentially, starting with the oldest.
Unless you arrived in Korea in a January, as I did, either your first or last year won't qualify for the exclusion, based on number of days in the year you were physically out of the country.
3. If you have paystubs, use them and file them for possible audit later, but they're not necessary.
Add up what you made working your job sponsoring your visa, any housing allowance, and estimate the value of any provided housing IN KRW.
I was anal about these estimates, but unless you're close to the $70,000/annum (varies) Max exclusion, it REALLY doesn't matter. Just make a good faith estimate you are comfortable with.
The irs.gov website has archived Annual Average Exchange rates. Use these to convert your earnings to USD.
4. Fill in your 1040 per instructions. You may have capital gains, rental income or other income sources. Just proceed as normal attaching any required schedules (ie. Schedule D - Capital gain/loss.)
Unless you are independently wealthy, your bottom line after all this stress will be ZERO.
5. Continue with remaining years, stuff 'em all in an envelope and mail it off. You are finished. IRS will let you know if there is a problem.
NO, there is no automatic penalty based on the fact that you're doing this late. I filed 7 back years' worth in one envelope. |
Very good advice, mole, and I commend you on your tax consciousness!
I have filed from overseas for the past 13 years, and would like to add a little to mole's brilliant action steps.
The overseas earned income exclusion is now over $87,000. I doubt that too many of us make that much in the equivalent of Korean won, Japanese yen, Malaysian ringgit, Chinese RMB, etc.
All forms can be downloaded from the http://irs.gov website. Likewise, all instructions are downloadable.
You need to have a note attached to the Form 1040 that shows your "W-2 Detail Information". Since your foreign employer does not give you a W-2, you have to supply this note which shows your 2007 (for example) wages in US$ equivalent. I didn't know that the irs had an annual average exchange rates page, but I will use that from now on. (I used a different method to come up with the average exchange rate.)
But, mr/ms mole missed one key item: PHOTOCOPY all forms, submissions, etc. before stuffing that envelope. I know it sounds a bit self-evident, but believe me, it isn't self-evident to many people. Always keep a copy for yourself.
Finally, overseas filers get an automatic 2-month extension, from 15 April to 15 June. If you fill out form 4868 (I think that is the correct number), then you will also get an additional 2 months, to 15 August. You are actually supposed to file 4868 ahead of time, but I just stick it in the envelope along with the Forms 1040, 2555, and etc. after having made photocopies.
Did I say you should photocopy everything, including checks that you write? I photocopy the envelope that I send the package in, to show that I got the correct address and had stamps on it. |
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mole
Joined: 06 Feb 2003
Location: Act III
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| Posted: Thu Feb 05, 2009 1:39 pm Post subject: |
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| Indeedy. I forgot to mention keeping copies of everything for self. I have loads of paperwork filed. Hope I never see it again, nah. I tend to ceremonially burn reeeeally old stuff, eventually and on occasion. THX, Jati. |
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antgonz
Joined: 30 Nov 2007
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| Posted: Sat Feb 07, 2009 8:45 pm Post subject: |
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| saving....thanks |
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Rob'sdad
Joined: 12 May 2008
Location: Seoul
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| Posted: Sun Feb 08, 2009 5:23 am Post subject: |
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| Jati wrote: |
| mole wrote: |
1. I called the IRS, though I suppose you can do it online, and ordered all necessary forms and their accompanying instructions for the years unfiled.
Use whichever 1040 you've used in the past and 2555-EZ Foreign Earned Income Exclusion.
2. Even you'll feel like it would save time otherwise, I recommend doing it sequentially, starting with the oldest.
Unless you arrived in Korea in a January, as I did, either your first or last year won't qualify for the exclusion, based on number of days in the year you were physically out of the country.
3. If you have paystubs, use them and file them for possible audit later, but they're not necessary.
Add up what you made working your job sponsoring your visa, any housing allowance, and estimate the value of any provided housing IN KRW.
I was anal about these estimates, but unless you're close to the $70,000/annum (varies) Max exclusion, it REALLY doesn't matter. Just make a good faith estimate you are comfortable with.
The irs.gov website has archived Annual Average Exchange rates. Use these to convert your earnings to USD.
4. Fill in your 1040 per instructions. You may have capital gains, rental income or other income sources. Just proceed as normal attaching any required schedules (ie. Schedule D - Capital gain/loss.)
Unless you are independently wealthy, your bottom line after all this stress will be ZERO.
5. Continue with remaining years, stuff 'em all in an envelope and mail it off. You are finished. IRS will let you know if there is a problem.
NO, there is no automatic penalty based on the fact that you're doing this late. I filed 7 back years' worth in one envelope. |
Very good advice, mole, and I commend you on your tax consciousness!
I have filed from overseas for the past 13 years, and would like to add a little to mole's brilliant action steps.
The overseas earned income exclusion is now over $87,000. I doubt that too many of us make that much in the equivalent of Korean won, Japanese yen, Malaysian ringgit, Chinese RMB, etc.
All forms can be downloaded from the http://irs.gov website. Likewise, all instructions are downloadable.
You need to have a note attached to the Form 1040 that shows your "W-2 Detail Information". Since your foreign employer does not give you a W-2, you have to supply this note which shows your 2007 (for example) wages in US$ equivalent. I didn't know that the irs had an annual average exchange rates page, but I will use that from now on. (I used a different method to come up with the average exchange rate.)
But, mr/ms mole missed one key item: PHOTOCOPY all forms, submissions, etc. before stuffing that envelope. I know it sounds a bit self-evident, but believe me, it isn't self-evident to many people. Always keep a copy for yourself.
Finally, overseas filers get an automatic 2-month extension, from 15 April to 15 June. If you fill out form 4868 (I think that is the correct number), then you will also get an additional 2 months, to 15 August. You are actually supposed to file 4868 ahead of time, but I just stick it in the envelope along with the Forms 1040, 2555, and etc. after having made photocopies.
Did I say you should photocopy everything, including checks that you write? I photocopy the envelope that I send the package in, to show that I got the correct address and had stamps on it. |
Totally accurate advice on this thread |
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Kuros
Joined: 27 Apr 2004
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| Posted: Sun Feb 08, 2009 11:20 am Post subject: |
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| mole wrote: |
but remember, federal income tax is unconstitutional and illegal anyway, so appeal it.
They will settle for some small portion of what they "demand" at first. It's all posturing. |
Of course that's not at all true, but the rest of the advice you've given is good.
| The people through the amendment ratification process wrote: |
| 16th Amendment- The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration. |
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mole
Joined: 06 Feb 2003
Location: Act III
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| Posted: Mon Feb 09, 2009 11:47 am Post subject: |
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Small update since this topic made me realize I was behind AGAIN!
The average annual exchange rates I used link off the irs site here:
http://www.federalreserve.gov/releases/g5a/
Only back to '97, but that's as far as I needed to go.
Kuros: Agreed. There's just a certain contingent that believes otherwise and they have my attention for the time being.
I'm not recommending a tax-strike protest.  |
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Jeff's Cigarettes
Joined: 27 Mar 2007
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| Posted: Mon Feb 09, 2009 2:30 pm Post subject: |
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| olt.com |
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aquaponics08
Joined: 22 Dec 2008
Location: Korea
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| Posted: Tue Feb 10, 2009 12:18 pm Post subject: |
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| What if the places you've worked have gone belly up and never gave you any paperwork? |
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Jeff's Cigarettes
Joined: 27 Mar 2007
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| Posted: Tue Feb 10, 2009 3:52 pm Post subject: |
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There's also a "foreign earned income" form for income received w/out w2 form. Like ur apt. I usually don't bother reporting it though.
Last edited by Jeff's Cigarettes on Tue Feb 10, 2009 7:05 pm; edited 1 time in total |
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Jati
Joined: 13 Dec 2008
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| Posted: Tue Feb 10, 2009 4:52 pm Post subject: |
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| aquaponics08 wrote: |
| What if the places you've worked have gone belly up and never gave you any paperwork? |
Type something up yourself. Get it notarized. The IRS usually works with people who come clean up front. You can tell them that the company went bankrupt. Anything you can find to show them that, i.e., newspaper article, bankruptcy filing, whatever?
I used to work part-time as a para-legal for a lawyer. Basically, any kind of affidavit is valid in court or other proceeding as testimony or evidence. You swear to a statement to the effect that the company went bankrupt and did not issue you any type of income form. You show what information you have and what you earned to the best of your recollection. And you have it witnessed and signed by someone other than yourself. Done deal.
Good luck. |
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chungp2
Joined: 07 Feb 2009
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| Posted: Tue Feb 10, 2009 7:35 pm Post subject: |
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| nice...thnx |
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mole
Joined: 06 Feb 2003
Location: Act III
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| Posted: Wed Feb 11, 2009 7:33 pm Post subject: |
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I think this was covered, but..
Estimate your income and include provided housing or housing allowance.
I was there almost a decade, and never had anything resembling proper documentation from a school whether public, private, uni, none.
If you don't outright lie about it, which I can think of no reason, rational or otherwise to do so, and you can justify it, use it.
Why are you talking about affidavits? Have you already been fingered by the IRS and they are requiring that?
Honestly, it's the US government. Look at how they keep track of their own finances.
Stop sweating it. |
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