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Tobias
Joined: 02 Jun 2008
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 Posted: Fri Mar 06, 2009 9:12 pm Post subject: New teachers from the USA--verse yourselves in the tax codes |
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If you're from the USA and are coming to Korea to work for the first time, you'd be wise to become aware of certain tax codes and forms. You'll be working in Korea, meaning you'll have a certain tax responsibility here. You'll also be making more than the minimum amount required to file with the IRS if you stay here for any appreciable amount of time. Naturally, there will be tax paperwork to submit to both governments in these cases.
You'd be smart to read up on the following:
The USA-Korea tax treaty. Workers here from the USA are exempt from paying taxes to Korea their first two years.
IRS forms 8802 & 6166. These forms are used to get a refund from the Korean government if you have taxes taken out of your salary here in your first two years.
IRS forms 2555 and 4868. These forms are used to declare income earned overseas and to apply for time extensions on filing. |
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bodybydada
Joined: 07 Sep 2006
Location: Jinju
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| Posted: Fri Mar 06, 2009 11:59 pm Post subject: |
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| I will have to double check this, but I thought the threshold for paying US income taxes on income earned while living (residing) abroad was much higher--in the neighborhood of 80,000-100,000 (including amenities like housing and school stipends for children). Has there been a recent change to that? |
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bodybydada
Joined: 07 Sep 2006
Location: Jinju
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| Posted: Sat Mar 07, 2009 12:21 am Post subject: |
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the threshold is 87,500, but you first have to pass the bonafide residnece test (12 consecutive months, usually for the tax year in question) or physical presence test (330 days in a calendar year spent in foreign country or countries).
You will need the 2555 EZ form for this exemption.
Your post was a little misleading. Yes, one must file, but no, one is not obligated to pay taxes in the US. (i know of no teachers here making over 87,500--although they certainly exist) |
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bogey666
Joined: 17 Mar 2008
Location: Korea, the ass free zone
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| Posted: Sat Mar 07, 2009 12:38 am Post subject: |
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| bodybydada wrote: |
the threshold is 87,500, but you first have to pass the bonafide residnece test (12 consecutive months, usually for the tax year in question) or physical presence test (330 days in a calendar year spent in foreign country or countries).
You will need the 2555 EZ form for this exemption.
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this suggests that for e.g. if one starts to work in Korea in say Feb of 2008 and stays until Feb 2009.
and that person files a US tax return for the year 2008.
that person would FAIL the "residence test".
because he/she was in the US for one month.
which I suppose then means I am supposed to pay US taxes on that income?? in US Dollars?
HAHAHAHAHAHAHAHAAHAHHAHAAHAHAHAHAHAHAHA
a wholehearted PHUCK THAT! |
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Straphanger
Joined: 09 Oct 2008
Location: Chilgok, Korea
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| Posted: Sat Mar 07, 2009 1:26 am Post subject: |
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| bogey666 wrote: |
which I suppose then means I am supposed to pay US taxes on that income?? in US Dollars?
HAHAHAHAHAHAHAHAAHAHHAHAAHAHAHAHAHAHAHA
a wholehearted PHUCK THAT! |
Your withholding was in USD. Your salary was in USD. Therefore, your tax is in USD. It's not hard.
That said, if you're going to post threads about taxes and not include links, you need to expect to get flamed.
Although...
| bogey666 wrote: |
| HAHAHAHAHAHAHAHAAHAHHAHAAHAHAHAHAHAHAHA |
is what he'll be saying when he's done OZ style in a federal prison for flaunting the tax code. |
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tired of LA
Joined: 06 Nov 2006
Location: Seoul
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| Posted: Sat Mar 07, 2009 1:45 am Post subject: |
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| bogey666 wrote: |
| bodybydada wrote: |
the threshold is 87,500, but you first have to pass the bonafide residnece test (12 consecutive months, usually for the tax year in question) or physical presence test (330 days in a calendar year spent in foreign country or countries).
You will need the 2555 EZ form for this exemption.
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this suggests that for e.g. if one starts to work in Korea in say Feb of 2008 and stays until Feb 2009.
and that person files a US tax return for the year 2008.
that person would FAIL the "residence test".
because he/she was in the US for one month.
which I suppose then means I am supposed to pay US taxes on that income?? in US Dollars?
HAHAHAHAHAHAHAHAAHAHHAHAAHAHAHAHAHAHAHA
a wholehearted PHUCK THAT! |
Its any 12 month period. So Feb. 2008 to Feb. 2009 would qualify you for the physical presence test.
http://www.irs.gov/faqs/faq/0,,id=199670,00.html |
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Tobias
Joined: 02 Jun 2008
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| Posted: Sat Mar 07, 2009 4:20 am Post subject: |
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| bodybydada wrote: |
| I will have to double check this, but I thought the threshold for paying US income taxes on income earned while living (residing) abroad was much higher--in the neighborhood of 80,000-100,000 (including amenities like housing and school stipends for children). Has there been a recent change to that? |
Body, you're thinking of the Maximum. That's 87,500 this year.
I'm talking about the minimum, which is about 10% the maximum. If you make below the minimum, you don't have to file. If you make more than the minimum, you must file. Again, whether you actually have to pay taxes on your above-the-min earnings depends on a couple of variables. |
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Tobias
Joined: 02 Jun 2008
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| Posted: Sat Mar 07, 2009 4:25 am Post subject: |
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| bogey666 wrote: |
this suggests that for e.g. if one starts to work in Korea in say Feb of 2008 and stays until Feb 2009.
and that person files a US tax return for the year 2008.
that person would FAIL the "residence test".
because he/she was in the US for one month.
which I suppose then means I am supposed to pay US taxes on that income?? in US Dollars?
HAHAHAHAHAHAHAHAAHAHHAHAAHAHAHAHAHAHAHA
a wholehearted PHUCK THAT! |
Relax. You'd be exempt, as you'd file AFTER you'd been away from the US for a year and therefore pass the physical presence test . I was in the USA for the first two months in 2007, but I was exempt from taxes for 2007, as when I filed (May 2008) I had been gone from the USA for more than a year. The IRS had no problem with this. My contract started in March 2007 anyway. |
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rac118
Joined: 23 Feb 2009
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| Posted: Sat Mar 07, 2009 4:25 am Post subject: Re: New teachers from the USA--verse yourselves in the tax c |
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| Tobias wrote: |
You'd be smart to read up on the following:
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thanks dad. got a little time on our hands? |
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Tobias
Joined: 02 Jun 2008
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| Posted: Sat Mar 07, 2009 4:27 am Post subject: |
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| Sure do. Waiting on my plane ride out of here. You can have the 1500+ -to-1 babysitting gigs. |
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