One of the expat advantages of a later tax filing due date - 16 June 2008 - for the 2007 US federal income tax return is the extra time to put together those papers related to foreign taxes. This 16 June due date can even be extended to 15 October by filing Form 4868. Because IRS [...]
Several weeks ago this writer was in Spain consulting with a dual citizen of both the United States and France. Happily Mme Palu announced that in 2004 she had inherited oil stock valued at $600,000 from her mother, a citizen of the United States. Having sold the same stock last year, Mme Palu was now [...]
For a number of years, Money Magazine would hold a contest between fifty tax preparers representing every state in the union. The publisher would provide each preparer with the same tax data in the role of a fictitious client. In most years, the results of each return were different – no two were identical.
In [...]
Any self-employed American expatriate can qualify for the Foreign Earned Income Exclusion. Unlike an employed expat, however, a multitude of complex issues arise concerning what can be deductible against foreign income. Consider tax home versus main home. Suppose you provide a consulting service from your main home in your foreign country of residence, but your [...]
Residents of foreign countries, including American expatriates, are often required to report and pay taxes on world-wide income. A resident is anyone who has been physically present for 183 days. So even though foreign earnings up to the $87,500 foreign earned income exclusion (FEIE) are excluded from US taxation, most foreign countries will tax those [...]
Qualifying for the Foreign Earned Income Exclusion (FEIE) is relatively simple. First, your tax home must be in a foreign country through a qualifying residency period. Your tax home is where you are indefinitely engaged as an employee or self-employed person. Second, you must have had foreign earned income: salary, self-employment, and/or employer-provided meals, lodging or [...]
In determining whether to file a tax return, the Foreign Earned Income Exclusion does not count. Although for 2007, $87,500 in foreign earned income can be excluded from taxation by the exclusion, the income earned in a foreign country is still counted against your Filing Status. Suppose you are married and earned $80,000 abroad. This income would be excluded from [...]
A 2007 U.S. tax return must be filed if your world-wide gross income exceeds your Standard Deduction and Exemption amount(s) according to your filing status:
Single $8,750
65 or older 10,050
Head of Household 11,250
65 or older 12,550
Qualifying widow(er) 14,100
65 or older 15,150
Married filing jointly 17,500
One Spouse 65 or older 18,550
Both Spouses 65 [...]