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Expatriate Tax Returns

American Expats

What You Need to Know About The Proposed Tax Bracket Changes For 2022

The United States has a progressive tax system, which means that taxpayers are taxed at different rates depending on their income level. The current tax brackets are 10%, 15%, 25%, 28%, 33%, 35%, and 37%.

For the tax year 2021, the income thresholds for each tax bracket are:

* 10% bracket: $0 to $9,875 for singles; $0 to $19,750 for married couples filing jointly

* 15% bracket: $9,875 to $40,125 for singles; $19,750 to $80,250 for married couples filing jointly

* 25% bracket: $40,125 to $85,525 for singles; $80,250 to $171,050 for married couples filing jointly

* 28% bracket: $85,525 to $163,300 for singles; $171,050 to $326,600 for married couples filing jointly

* 33% bracket: $163,300 to $207,350 for singles; $326,600 to $414,700 for married couples filing jointly

*35% bracket: $209,426 to $523,600 for singles; $418,851 to $628,300 for married couples filing jointly

*37% bracket: $532,600 or more for singles; $628,300 or more for marries couples filing jointly

Who will the tax bracket change affect?

The proposed tax bracket changes will affect taxpayers with an income of $200,000 or more. Under the proposed changes, there will be a new tax bracket of 39.6% for taxpayers with an income of $200,000 or more.

What are the proposed changes?

The proposed changes would create a new tax bracket of 39.6% for taxpayers with an income of $200,000 or more. The other tax brackets would be unchanged.

How will the changes impact you?

The changes would impact you if you have an income of $200,000 or more. If you are in this income bracket, you would be required to pay 39.6% in taxes on your income.

What can you do to prepare for the changes?

If you are in the affected income bracket, you can begin to plan for the changes by adjusting your tax withholding. You can also make adjustments to your budget to account for the higher taxes you will be required to pay.

Wrapping up

The proposed tax bracket changes would create a new tax bracket of 39.6% for taxpayers with an income of $200,000 or more. The other tax brackets would be unchanged. The changes would impact you if you have an income of $200,000 or more. If you are in this income bracket, you would be required to pay 39.6% in taxes on your income. You can begin to prepare for the changes by adjusting your tax withholding and making adjustments to your budget

If you have questions about your tax brackets or other tax information, visit our contact page to connect with an expert.

Tax Advice for Americans Living in South Korea

Are you an American living abroad in South Korea? South Korea is the next hotspot for American life considering its thriving economy. A common question many Americans living there ask is “should I file my taxes with the South Korean or US government?” Expatriate Tax Returns is here to answer your questions and help you with your tax needs.

If you are an American living in South Korea, Expatriate Tax Returns is the perfect company to file your taxes with. We service all people with American citizenship no matter their location. Filing with us is easy and our staff is happy to help answer any questions or resolve any tax concerns.

The South Korean tax calendar follows the same deadlines as the American format: January 1 to December 31. Tax returns must be filed by the 31st of May in the following year. The only difference is that residents in South Korea must pay 50% of their taxes by the 30th of November in the year that the taxes are due.

Americans living in South Korea must also file using specific documents. These documents include but are not limited to:

IRS Form 1040 (tax returns for individual income)

IRS Form 8938 (Specified Foreign Financial Assets; FATCA)

FinCEN Form 114 (Foreign Band and Financial Accounts FBAR)

Expatriate Tax Services is helping Americans all around the world. If you are in South Korea, a different foreign country, or even America, visit www.expatriatetaxreturns.com to connect with a professional tax specialist.

2021 Tax Returns: File and Avoid These Mistakes

 

Don’t miss the deadline! People who have not filed their 2021 tax return have a limited time to complete filing. The extension deadline is October 17, 2022. Learn about the best way to file and how to avoid common mistakes when filing under an extension with Expatriate Tax Returns.

The best way to file tax returns is electronically. Filing electronically is the quickest and easiest way to file since the submission will be immediate, the electronic system can detect form errors, and calculates data. Instead of waiting on the postage system to deliver tax returns or for approval on the filing submission, taxpayers can depend on accuracy and effectiveness by filing online. Filing online helps taxpayers avoid these common mistakes:

Misspellings

Names used for filing should match the spelling on the taxpayer’s Social Security Card and ID. Misspellings could prolong filing time and could disqualify the filing submission.

Inaccurate Information

Information such as the SSN, taxpayer income, address, and other information should be accurate and the exact same as what is printed on the associated documents. Online filing could help prevent submission rejection since the system can prevent mathematical errors.

Missing Information

Provide as much information as possible, especially if the online system is requesting such information. If any data is missing from the submission, preparers will have to collect the information which prolongs the filing process time and can disqualify the submission.

Visit www.expatriatetaxreturns.com if you have any questions or concerns about electronically filing 2021 tax returns under the October 17, 2022 extension deadline.

Checking the Status of Your Return

Once you file your taxes, you may be anxious to receive your return. The IRS has a tool that can help track your refund through the process. The “Where’s My Refund” tool is available on IRS.gov to all those who have filed.
There is also an app available for download called IRS2Go app. Users will need their social security number, tax filing status, and refund amount to utilize either tool.

The tool will provide three phases in which to track to refund:

  • Return received
  • Refund approved
  • Refund sent

When the status changes from received to approved, the IRS is ready to send your refund via your chosen method. Keep in mind that the tool is updated once a day, so set a reminder for yourself to check it and stay on top of your refund.

Communication from the IRS

Now that Tax Day has passed, some consumers may open their mailbox to find a letter from the IRS. The IRS will always communicate via mail, so it is essential to read the letter carefully and in its entirety. The IRS may reach out for various reasons, including a change in your refund, a question regarding your tax return, a request for more information, or a balance is due.
If the request is for an audit, give our team a call, we are always available to assist you throughout the entire process.
It is important to respond timely to any request sent via the IRS and act accordingly. If a balance is requested, pay as soon as possible to avoid further issues. Options for payment installments can be found on the IRS website.
The IRS will only reach out via email, phone calls, or emails claiming to be the IRS should be considered fraudulent.

Tax Benefits for Small Business Owners

The IRS focuses on small business owners and provides tips and tax benefits to help them get the most out of their operations.
First, many small business owners can claim the home office deduction. To qualify, a business owner must use a specific room in the home exclusively for business.
To claim the credit, filers should use Form 8829 Expenses for Business Use of Your Home. This form calculates the credit based on the expenses of home operations related to personal and business use. Additionally, businesses can often deduct business-related food and beverage purchases. To qualify, the owner or one employee of the business must be present at the time of sale. Note that grocery or convenience stores do not qualify for this deduction. Look for more information on the IRS website.