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Why It’s Easy to Feel Confused About Expatriate Taxes
Confusion. It’s a feeling we’ve all experienced from time to time and no one likes feeling that way. When it comes to taxes, just about everyone feels confused and that is even more the case when it comes to Expatriate Taxes.
For example, tax terms like the the FBAR (Report of Foreign Bank and Financial Accounts) can be extremely confusing for American expats to understand. The FBAR is necessary to pay if you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account. Not only is the FBAR confusing, but it can also be confusing to even know when the FBAR is due. The official IRS website hasn’t even been clear on this, but we informed our clients that the FBAR for your 2016 tax returns is extended to October 15.
With a change in administrations in Washington, all of the tax details for expats continues to change and be confusing. At Expatriate Tax Returns, our goal is to remove the confusion from preparing and filing your expat taxes. We know you’re busy, successful individuals who are living and working abroad. We don’t want you to be frustrated, confused or hassled with your expat tax returns or trying to figure out the intricate tax laws of the IRS as they pertain to American expatriates.
As April quickly approaches, our tax professionals at ExpatriateTaxReturns.com are ready, willing and able to help our clients during this tax season. Preparing tax returns for U.S. expats requires an added level of dedication and that’s why we prefer the mantra “Going the extra mile for our clients.”
Nobody likes feeling confused, especially smart and successful executives like our clients. Call Expatriate Tax Returns today to see how we’re going to go the extra mile for you. That’s our pledge and you can hold us to it! Simply fill out the easy form on the front of our website or call our Support Hotline today: (877) ETAX-123 or (877) 382-9123.
Expat Advice: Don’t Lose Your Passport
The Election is Over and What the New Administration Could Mean for U.S. Expats
That was a long, grueling 2-year presidential race for the American people. The results of last Tuesday’s election for the new President of the United States of America were surprising for many. For American expats living abroad, the question now focuses on what implications will the Trump Administration have for expatriates.
In a recent article on the CNBC.com website, Saheli Roy Choudhury writes that President-Elect Donald Trump could cut the tax bills of U.S citizens abroad. The new President, who will be inaugurated on January 20, has big plans to overhaul the U.S. tax system. This significant change would benefit American expats abroad by lowering their overall tax bill. Kurt Rademacher, a wealth planning expert told CNBC’s “Squawk Box” that Trump’s tax plans could reduce the headline tax rate and also eliminate the estate tax that currently applied to worldwide assets.
The top federal rate of the estate tax currently sits at 40 percent, with estates worth less than $5.45 million exempt for the tax, according to the Internal Revenue Service (IRS). “The tax bill for expats residing abroad would be reduced just as it would be if they remained in the United States,” said Rademacher, adding that Trump had not yet said if he planned to amend existing tax rules on individual foreign earnings.
U.S. citizens are taxed in the U.S. on their worldwide income no matter where they are based, although, according to the IRS website, expats could exclude a certain amount of their foreign earnings, adjusted annually for inflation, from their worldwide taxable income; for 2015, that amount was $100,800. They could also exclude or deduct certain sums related to foreign housing. “Trump’s theory, of course, is that these tax cuts that benefit mostly the wealthy individuals, and in some cases large corporations, would generate additional jobs and growth that would fund the economy and fuel changes for people who feel left out,” Rademacher explained of changes that appeared to be weighted in favor of the wealthy.
No one knows for certain how President-Elect Trump with a Republican Congress will alter current expat tax law and that’s why there remains much uncertainty for U.S. Expatriates. The expat tax experts at Expatriate Tax Returns are here to guide you through your expat tax preparation regardless of how the transition in the White House affects your tax returns. Our experience in expatriate taxes dates back several administrations and we will continue to adapt for the next White House as well. Call us today at 877-382-9123 to remove the stress and hassle from your expat tax preparation.
It’s That Time of Year Again for Expats
The leaves are changing in America and falling to the ground. No matter where you currently live and work, autumn in America means it’s expat tax time. You might miss the changing colors of fall in the U.S., but you CANNOT miss your October 15 deadline as an American expatriate.
Expats: Do You Know What You’re Entitled To?
As an American expatriate living abroad, you have a unique opportunity to claim a Foreign Tax Credit. By doing so, you will avoid dual taxation, which is when two different countries impose taxes on the same income. No one wants to be doubly taxed of course, but if you’re caught unaware you could be subject to this potential unfairness.
Expats should understand how important it is to complete Form 1116. This form is then attached to your U.S. expat tax return. Then you’ll be able to claim this credit and avoid paying United States taxes on income that you have already paid on in your foreign tax home.
In order to qualify for the Foreign Tax Credit expats must have earned income, have paid tax or acquired a tax liability that you will have to pay in the future and live legally in the foreign country as an American expat.
Claiming the Foreign Tax Credit directly offsets your U.S. taxes for any income earned overseas. This can only be used to offset U.S. taxes on your interest, dividends or compensation earned abroad. It cannot exceed the amount of U.S. taxes you pay on the foreign income. If it does exceed that amount, you can carry forward the balance to future tax years.
The talented team at Expatriate Tax Returns will be able to quickly determine if you are eligible for this credit and if you are, a tax expert will walk you through this process. We don’t want you to be unfairly double taxed and that is why it is critical to know about the Foreign Tax Credit before filing your expat tax returns.
Contact Expatriate Tax Returns for more information by calling 877-382-9123 toll free.