9 ms·

"The U.S., by comparison, taxes citizens’ income no matter where it’s earned." This is a common statement I see pretty often on the internet, often in the cont

"The U.S., by comparison, taxes citizens’ income no matter where it’s earned." This is a common statement I see pretty often on the internet, often in the context of bashing the US. However, there's a big asterisk there if you look the rules up. If you're not making over 6 figures, you still have to file I believe, but you don't pay taxes. So the vast majority of Americans abroad are not paying taxes back to the US ($100800 / year is the cut off by the looks of it)[1]. I'm not saying it isn't annoying still to file with the IRS or there aren't people who are over the threshold getting burned, I just feel it's often a glossed over detail that puts the US in an unnecessarily harsh light, considering, again, most people won't be penalized financially here. [1] https://time.com/money/4298634/expat-expatriate-taxes-us-myths/ https://time.com/money/4298634/expat-expatriate-taxes-us-myt...

fierarul 10y ago
You are ignoring the $10,000-per-year fines for failing to file FBAR forms that spooked a lot of expats with small companies abroad.
- moonshinefe 10y ago
  I don't believe so, my last sentence mentions I acknowledge filing forms to a different country is annoying and an additional burden. It's certainly not the US only who penalizes people for not filing legally required tax forms on time.
  - fierarul 10y ago
    The IRS had several amnesty programs FBAR-related because so few people knew about them, even those that did send their tax papers as required!
DrJokepu 10y ago
Also, you get Foreign Tax Credit for income tax paid abroad, which means that even if you earn more than the Foreign Income Exclusion Threshold ($100,800 in 2015) in practice you will only pay the IRS any income tax if you live in a country where the income tax rates are lower than the US federal income tax rates, which is not common (although state income taxes sometimes make this a bit more complicated). In practice this means that US persons living abroad typically only pay US income tax if they make decent money and the local taxes are lower than those in the US and even then they only pay the difference. You still need to file your tax returns every year though.
- Twirrim 10y ago
  > if you live in a country where the income tax rates are lower than the US federal income tax rates, which is not common (although state income taxes sometimes make this a bit more complicated). That only applies to a subset of countries that the US has an agreement with.
  - DrJokepu 10y ago
    The situation is way more complicated than what can be discussed in a HN comment. When it comes to things like social security taxes, the taxation of US-sourced income etc., double taxation treaties can help a lot, but generally speaking no tax treaty is required to claim foreign tax credit.
mysterypie 10y ago
> most people won't be penalized An American couple I know, ordinary people with ordinary lives and nothing special level of income, who live in Canada pay ~$5000 in legal fees every year to do their non-resident U.S. tax return and stay in compliance with U.S. law. They pay zero U.S. tax. But saying that filing the U.S. tax is merely "annoying" doesn't cut it. I would say $5000 per year can be described as being penalized.
- DrJokepu 10y ago
  Yes that does not sound right. My wife is a US citizen, we live in the UK, I prepare her US tax returns every year myself. It takes about a Saturday afternoon every year and it costs me $0. It's rather complicated, but not paying-someone-else-five-thousand-dollars-every-year-to-do-it complicated. Your friends' tax advisor is taking advantage of them.
- tluyben2 10y ago
  Why would you do that? Maybe it's a weird question and it's coming from someone who doesn't see upside to having a US passport in the first place, but why keep it if it's that painful?
  - Symbiote 10y ago
    They may not have any other citizenship. It often takes years, and can also costs $1000s, to acquire it.
  - kalleboo 10y ago
    It's actually illegal to get rid of your US citizenship for tax reasons.
    - tluyben2 10y ago
      Really? But how would they know you did it for that reason?
    - owenversteeg 10y ago
freddie_mercury 10y ago
This is true but the situation is substantially more complex than you suggest, including things like PFIC treatment of retirement plans in the foreign country (where you need to pay unrealised capital gains every year), differing treatment on capital gains of housing, Affordable Care Act penalties if you're in the US more than 30 days. Not to mention any use of the foreign tax credit means you need to calculate AMT. Not to mention none of paperwork you need is nicely collected and presented in US Dollars for you. God forbid you live someplace like Australia that uses a July-June tax year. I have to file my US taxes every year and the "cost" is usually $400 to $800 to hire a tax preparer who knows what they are doing and takes a fair amount of my time every year.
- moonshinefe 10y ago
  Thanks for the first hand account. I'm not from the US and was just mainly pointing out that a lot of details are clearly left out on news site articles when they try to sensationalize this stuff. I guess at the end of the day the entire situation is very complicated and can't be summed up in a small article. I still don't think it's very accurate how they're portraying it though, nonetheless. The article doesn't mention your situation really at all, it just makes a generalization and moves on.
- bogomipz 10y ago
  Do you pay taxes only on earnings over the 108K then? I was under that that's what the ceiling was the OP was referring to.
  - jimmywanger 10y ago
    I think you pay US taxes only on 108K, plus taxes on whatever tax jurisdiction you're in. Which is kind of a bummer. For the first 108K, AFAIK, you just pay taxes to wherever you earned the money. If you made 100k a year selling widgets from Columbia, you're only subject to Columbian income tax. I don't think there's any such thing as a free lunch - you'll have to pay for one set of taxes no matter what. The US double taxes over 108k.
jernfrost 10y ago
It is an annoying burden though. My wife is American and doesn't earn anything like that amounts, but really hates this thing. You easily end up in a situation where you didn't know you were supposed to file and you get get worked up because in typical American fashion these forms are filled with dire warning and threats of harsh punishment for making mistakes. That is what I don't like about the US. They are not very accepting towards honest mistakes. The legal system frequently disregards intent when ruling and punishment for even small infractions can be quite severe in the US. It is not a good thing when citizens are frequently genuinely afraid of their own country.
- smhost 10y ago
  > The legal system frequently disregards intent when ruling and punishment for even small infractions can be quite severe in the US. Is this actually true? I'd like to learn more about if it is. My personal experience has been that all of my honest small mistakes were accepted as honest mistakes, occasionally with a small fine.
  - vacri 10y ago
    The US incarceration rate was at 750/100k about 5 years ago, which is 1% of the adult population, and significantly higher than everywhere else on the planet. South Africa during the height of apartheid was 'only' 540. The rest of the western world is sub-200/100k, with most of them at 150 or lower. The US is more than five times more imprison-ey than pretty much any of its contemporaries, and ten times more than select examples like Norway or Germany. Unless Americans are ridiculously more criminal-minded than other humans, the US is doling out more punishment than others for the same misdeeds.
    - ptaipale 10y ago
      The US has significantly more misdeeds, e.g. ~5 times as many homicides as most West European nations. This is a result of very many things of course. But U.S. is improving, though; 25 years ago the difference was more like 10 times. Some countries in Europe (like Sweden) have actually stopped improving, so eventually the U.S. will catch up. Then it will have less homicides, which is likely to also bring less incarceration. Sometimes I think that the European style is not necessarily better. E.g. yesterday I read about two cases in the local newspaper crime news section. There was 5.5 years prison sentence given to a hamburger restaurant owner for tax evasion done over the course of 6 months, and 90 hours of community service plus conditional imprisonment for an aggravated child molestation over a period of 7 years. This ratio doesn't look right to me, but it's what we do to get the low incarceration rate.
deleted 10y ago
[deleted]
charlesdm 10y ago
1. I would assume it's still annoying to file. I'm Belgian, and if I were to move abroad, I would have to file nothing with the Belgian authorities. Heck, I have filled out US withholding tax forms in the past, and they suck. 2. If you do make more than +- the $100,000, you do obviously end up paying significantly more. There's no clean and reasonable way to exit for (wealthy) americans, if you would want to. 3. I think people should, in general, be able to move away from their home country if they want to without too much additional burdens. Definitely not the case for americans.
- belgiantravelng 10y ago
  > I'm Belgian, and if I were to move abroad, I would have to file nothing with the Belgian authorities. Don't you have to ask to get yourself radiated from Belgium's tax system?
  - charlesdm 10y ago
    You have to file one last tax return (< the usual one year). Once you have done that and are living abroad, you're pretty much in the clear.
thesimon 10y ago
Foreign banks tend to not deal with customers with US tax residence though due to FATCA requirements. So it might be a burden even if you are under the threshold.
- freddie_mercury 10y ago
  This hasn't been my experience at all in three countries (Singapore, Vietnam, and Australia)
  - arcticbull 10y ago
    FATCA is relatively new, effective 2010, so if you opened your bank account before then, you may well be grandfathered in.
- Broken_Hippo 10y ago
  I've not had that issue. The worst i dealt with was that one bank wanted paperwork from my bank in the US, which had been closed before moving (around 9 months living with only cash). The other bank didn't act like it was an issue.
- deleted 10y ago
  [deleted]
- beagle3 10y ago
  Banks and brokers can't hold/manage/transact securities (stocks and bonds) for a US taxpayer because of an SEC -- unless they are SEC regulated, which almost no one outside the US is. Therefore, us taxpayers are also much less profitable for them even if the FATCA requirements are all satisfied.
- saryant 10y ago
  I had an account in France for a while without any trouble. BNP Paribas.
beagle3 10y ago
freddie_mercury bellow touches most of it, and there are other issues: a friend of mine who lives abroad but maintains a mailing address in the us, has a yearly dance taking hours of calls, faxes and writing letters to explain that he does not need to file state taxes and that the state should not, in fact, put a lien on his assets. Also, the filing requirements (fbar and fatca in addition to a lot of stuff on the "regular" form) are insanely onerous. The tax code essentially assumes that any financial activity a US taxpayer does outside the US (even if that's where they reside) is done with the intention of tax evasion. When FBAR was created, it covered a few hundred to a few thousand presumed evaders. Now it covers millions to ten of millions with the same presumption of evasion.
_of 10y ago
What happens if you simply ignore filing US taxes? Do you get arrested if you return, even if it's just for visiting?
arcticbull 10y ago
You must continue to file, claiming a foreign tax credit. Then there's the double-taxation issue, in that unless the country you're living in has a tax treaty with the US, any income over 100,000 has to have taxes paid in full to both countries, and there aren't that many tax treaties. Then you have to file FBARs with FinCEN because likely you have a bank account with more than $10,000 in it, subject to forfeiture of 50% of the balance if you don't. Then there's FATCA which is onerous enough that in many countries, banks will not do business with US persons in the first place, which will poses a challenge. Then there's the fact foreign brokerages cannot have accounts for the benefit of US persons unless they're regulated by the SEC. Then if you own a business abroad that you're the sole proprietor of you may well have a controlled foreign corporation (IRS 4.61.7, form 5471), have fun.
- jsjohnst 10y ago
  It was my understanding that it's not true double taxation, but rather the US gets the money difference if it's the higher tax. So for example, if country ABC's tax rate is 25% and the US would be 38% for you, you'd pay ABC 25% and the US 13%. If however ABC country was 42% tax rate and the US 33% for you, then you'd owe the US government nothing (but wasted time) on your income. Correct me if I'm wrong, but I am pretty sure this is how it works.
  - deleted 10y ago
    [deleted]
  - arcticbull 10y ago
    That's how it works if the country you're in has a no-double-taxation treaty with the US, and what's included/how it's calculated depends on how the treaty works. Many do not. [1] If you live in a country without a tax treaty, like the Bahamas for instance, you must pay both taxes separately with no offsets/credits. [2] IANATA though so always worth double-checking with this kind of money on the line. My experience with this is moving to the US from Canada, so I dealt with both tax treaty income and dual-status returns. [1] http://www.rumbaklaw.com/resources-and-tools/us-federal-tax-resources/countries-with-and-without-income-tax-treaties-with-the-u-s/ http://www.rumbaklaw.com/resources-and-tools/us-federal-tax-... [2] https://www.irs.gov/individuals/international-taxpayers/tax-treaties https://www.irs.gov/individuals/international-taxpayers/tax-...
rodionos 10y ago
In the top-right corner of every US tax form, there is an OMB control number. It stands for estimated annual burden imposed on the public. The estimated burden consists of time spent multiplied by implied hourly cost. These estimates may appear innocent but they actually have a direct impact on the government, such as agency head count and budgets. The estimate for Form 1040 is as follows: > [0] The average burden for taxpayers filing Form 1040 is about 15 hours and $280 If I add up my time as well as the tax accountant's time and fees to file taxes, this is quite underestimated. However, this is anecdotal evidence. What would be great is to have two fields on these forms where tax payers can enter the actual amount of time and expenses required to complete them, as part of the feedback. The agencies can then use the median to update their assumptions and act accordingly. [0] https://www.federalregister.gov/documents/2014/04/30/2014-09819/proposed-collection-comment-request-for-form-1040-and-schedules-a-b-c-c-ez-d-e-eic-f-h-j-r-and-se https://www.federalregister.gov/documents/2014/04/30/2014-09...
LyndsySimon 10y ago
My understanding is that the this doesn't apply to self-employment tax either - so if you're consulting you on the hook for that as well.
Spooky23 10y ago
The problem is that compliance is complex and enforcement random. Currency fluctuations can change your circumstances overnights. Also lots of catch-22 situations. People who are American by virtue of birth can but never live here can get into trouble when they coke to the attention of the tax authorities. Renunciation is also difficult and creates other issues.
FabHK 10y ago
I'd much appreciate if people who comment also mention in how many jurisdictions they have paid taxes, so that one has a frame of reference. > So the vast majority of Americans abroad are not paying taxes back to the US ($100800 / year is the cut off by the looks of it)[1]. Do you assume that he vast majority of Americans abroad are not making USD 100800? Because it doesn't say so in the source you provided.

fierarul 10y ago

You are ignoring the $10,000-per-year fines for failing to file FBAR forms that spooked a lot of expats with small companies abroad.

moonshinefe 10y ago
I don't believe so, my last sentence mentions I acknowledge filing forms to a different country is annoying and an additional burden. It's certainly not the US only who penalizes people for not filing legally required tax forms on time.
- fierarul 10y ago
  The IRS had several amnesty programs FBAR-related because so few people knew about them, even those that did send their tax papers as required!

DrJokepu 10y ago

Also, you get Foreign Tax Credit for income tax paid abroad, which means that even if you earn more than the Foreign Income Exclusion Threshold ($100,800 in 2015) in practice you will only pay the IRS any income tax if you live in a country where the income tax rates are lower than the US federal income tax rates, which is not common (although state income taxes sometimes make this a bit more complicated). In practice this means that US persons living abroad typically only pay US income tax if they make decent money and the local taxes are lower than those in the US and even then they only pay the difference. You still need to file your tax returns every year though.

Twirrim 10y ago
> if you live in a country where the income tax rates are lower than the US federal income tax rates, which is not common (although state income taxes sometimes make this a bit more complicated). That only applies to a subset of countries that the US has an agreement with.
- DrJokepu 10y ago
  The situation is way more complicated than what can be discussed in a HN comment. When it comes to things like social security taxes, the taxation of US-sourced income etc., double taxation treaties can help a lot, but generally speaking no tax treaty is required to claim foreign tax credit.

mysterypie 10y ago

> most people won't be penalized An American couple I know, ordinary people with ordinary lives and nothing special level of income, who live in Canada pay ~$5000 in legal fees every year to do their non-resident U.S. tax return and stay in compliance with U.S. law. They pay zero U.S. tax. But saying that filing the U.S. tax is merely "annoying" doesn't cut it. I would say $5000 per year can be described as being penalized.

DrJokepu 10y ago
Yes that does not sound right. My wife is a US citizen, we live in the UK, I prepare her US tax returns every year myself. It takes about a Saturday afternoon every year and it costs me $0. It's rather complicated, but not paying-someone-else-five-thousand-dollars-every-year-to-do-it complicated. Your friends' tax advisor is taking advantage of them.
tluyben2 10y ago
Why would you do that? Maybe it's a weird question and it's coming from someone who doesn't see upside to having a US passport in the first place, but why keep it if it's that painful?
- Symbiote 10y ago
  They may not have any other citizenship. It often takes years, and can also costs $1000s, to acquire it.
- kalleboo 10y ago
  It's actually illegal to get rid of your US citizenship for tax reasons.
  - tluyben2 10y ago
    Really? But how would they know you did it for that reason?
  - owenversteeg 10y ago

freddie_mercury 10y ago

This is true but the situation is substantially more complex than you suggest, including things like PFIC treatment of retirement plans in the foreign country (where you need to pay unrealised capital gains every year), differing treatment on capital gains of housing, Affordable Care Act penalties if you're in the US more than 30 days. Not to mention any use of the foreign tax credit means you need to calculate AMT. Not to mention none of paperwork you need is nicely collected and presented in US Dollars for you. God forbid you live someplace like Australia that uses a July-June tax year. I have to file my US taxes every year and the "cost" is usually $400 to $800 to hire a tax preparer who knows what they are doing and takes a fair amount of my time every year.

moonshinefe 10y ago
Thanks for the first hand account. I'm not from the US and was just mainly pointing out that a lot of details are clearly left out on news site articles when they try to sensationalize this stuff. I guess at the end of the day the entire situation is very complicated and can't be summed up in a small article. I still don't think it's very accurate how they're portraying it though, nonetheless. The article doesn't mention your situation really at all, it just makes a generalization and moves on.
bogomipz 10y ago
Do you pay taxes only on earnings over the 108K then? I was under that that's what the ceiling was the OP was referring to.
- jimmywanger 10y ago
  I think you pay US taxes only on 108K, plus taxes on whatever tax jurisdiction you're in. Which is kind of a bummer. For the first 108K, AFAIK, you just pay taxes to wherever you earned the money. If you made 100k a year selling widgets from Columbia, you're only subject to Columbian income tax. I don't think there's any such thing as a free lunch - you'll have to pay for one set of taxes no matter what. The US double taxes over 108k.

jernfrost 10y ago

It is an annoying burden though. My wife is American and doesn't earn anything like that amounts, but really hates this thing. You easily end up in a situation where you didn't know you were supposed to file and you get get worked up because in typical American fashion these forms are filled with dire warning and threats of harsh punishment for making mistakes. That is what I don't like about the US. They are not very accepting towards honest mistakes. The legal system frequently disregards intent when ruling and punishment for even small infractions can be quite severe in the US. It is not a good thing when citizens are frequently genuinely afraid of their own country.

smhost 10y ago
> The legal system frequently disregards intent when ruling and punishment for even small infractions can be quite severe in the US. Is this actually true? I'd like to learn more about if it is. My personal experience has been that all of my honest small mistakes were accepted as honest mistakes, occasionally with a small fine.
- vacri 10y ago
  The US incarceration rate was at 750/100k about 5 years ago, which is 1% of the adult population, and significantly higher than everywhere else on the planet. South Africa during the height of apartheid was 'only' 540. The rest of the western world is sub-200/100k, with most of them at 150 or lower. The US is more than five times more imprison-ey than pretty much any of its contemporaries, and ten times more than select examples like Norway or Germany. Unless Americans are ridiculously more criminal-minded than other humans, the US is doling out more punishment than others for the same misdeeds.
  - ptaipale 10y ago
    The US has significantly more misdeeds, e.g. ~5 times as many homicides as most West European nations. This is a result of very many things of course. But U.S. is improving, though; 25 years ago the difference was more like 10 times. Some countries in Europe (like Sweden) have actually stopped improving, so eventually the U.S. will catch up. Then it will have less homicides, which is likely to also bring less incarceration. Sometimes I think that the European style is not necessarily better. E.g. yesterday I read about two cases in the local newspaper crime news section. There was 5.5 years prison sentence given to a hamburger restaurant owner for tax evasion done over the course of 6 months, and 90 hours of community service plus conditional imprisonment for an aggravated child molestation over a period of 7 years. This ratio doesn't look right to me, but it's what we do to get the low incarceration rate.

deleted 10y ago

[deleted]

charlesdm 10y ago

1. I would assume it's still annoying to file. I'm Belgian, and if I were to move abroad, I would have to file nothing with the Belgian authorities. Heck, I have filled out US withholding tax forms in the past, and they suck. 2. If you do make more than +- the $100,000, you do obviously end up paying significantly more. There's no clean and reasonable way to exit for (wealthy) americans, if you would want to. 3. I think people should, in general, be able to move away from their home country if they want to without too much additional burdens. Definitely not the case for americans.

belgiantravelng 10y ago
> I'm Belgian, and if I were to move abroad, I would have to file nothing with the Belgian authorities. Don't you have to ask to get yourself radiated from Belgium's tax system?
- charlesdm 10y ago
  You have to file one last tax return (< the usual one year). Once you have done that and are living abroad, you're pretty much in the clear.

thesimon 10y ago

Foreign banks tend to not deal with customers with US tax residence though due to FATCA requirements. So it might be a burden even if you are under the threshold.

freddie_mercury 10y ago
This hasn't been my experience at all in three countries (Singapore, Vietnam, and Australia)
- arcticbull 10y ago
  FATCA is relatively new, effective 2010, so if you opened your bank account before then, you may well be grandfathered in.
Broken_Hippo 10y ago
I've not had that issue. The worst i dealt with was that one bank wanted paperwork from my bank in the US, which had been closed before moving (around 9 months living with only cash). The other bank didn't act like it was an issue.
deleted 10y ago
[deleted]
beagle3 10y ago
Banks and brokers can't hold/manage/transact securities (stocks and bonds) for a US taxpayer because of an SEC -- unless they are SEC regulated, which almost no one outside the US is. Therefore, us taxpayers are also much less profitable for them even if the FATCA requirements are all satisfied.
saryant 10y ago
I had an account in France for a while without any trouble. BNP Paribas.

beagle3 10y ago

freddie_mercury bellow touches most of it, and there are other issues: a friend of mine who lives abroad but maintains a mailing address in the us, has a yearly dance taking hours of calls, faxes and writing letters to explain that he does not need to file state taxes and that the state should not, in fact, put a lien on his assets. Also, the filing requirements (fbar and fatca in addition to a lot of stuff on the "regular" form) are insanely onerous. The tax code essentially assumes that any financial activity a US taxpayer does outside the US (even if that's where they reside) is done with the intention of tax evasion. When FBAR was created, it covered a few hundred to a few thousand presumed evaders. Now it covers millions to ten of millions with the same presumption of evasion.

_of 10y ago

What happens if you simply ignore filing US taxes? Do you get arrested if you return, even if it's just for visiting?

arcticbull 10y ago

You must continue to file, claiming a foreign tax credit. Then there's the double-taxation issue, in that unless the country you're living in has a tax treaty with the US, any income over 100,000 has to have taxes paid in full to both countries, and there aren't that many tax treaties. Then you have to file FBARs with FinCEN because likely you have a bank account with more than $10,000 in it, subject to forfeiture of 50% of the balance if you don't. Then there's FATCA which is onerous enough that in many countries, banks will not do business with US persons in the first place, which will poses a challenge. Then there's the fact foreign brokerages cannot have accounts for the benefit of US persons unless they're regulated by the SEC. Then if you own a business abroad that you're the sole proprietor of you may well have a controlled foreign corporation (IRS 4.61.7, form 5471), have fun.

jsjohnst 10y ago
It was my understanding that it's not true double taxation, but rather the US gets the money difference if it's the higher tax. So for example, if country ABC's tax rate is 25% and the US would be 38% for you, you'd pay ABC 25% and the US 13%. If however ABC country was 42% tax rate and the US 33% for you, then you'd owe the US government nothing (but wasted time) on your income. Correct me if I'm wrong, but I am pretty sure this is how it works.
- deleted 10y ago
  [deleted]
- arcticbull 10y ago
  That's how it works if the country you're in has a no-double-taxation treaty with the US, and what's included/how it's calculated depends on how the treaty works. Many do not. [1] If you live in a country without a tax treaty, like the Bahamas for instance, you must pay both taxes separately with no offsets/credits. [2] IANATA though so always worth double-checking with this kind of money on the line. My experience with this is moving to the US from Canada, so I dealt with both tax treaty income and dual-status returns. [1] http://www.rumbaklaw.com/resources-and-tools/us-federal-tax-resources/countries-with-and-without-income-tax-treaties-with-the-u-s/ http://www.rumbaklaw.com/resources-and-tools/us-federal-tax-... [2] https://www.irs.gov/individuals/international-taxpayers/tax-treaties https://www.irs.gov/individuals/international-taxpayers/tax-...

rodionos 10y ago

In the top-right corner of every US tax form, there is an OMB control number. It stands for estimated annual burden imposed on the public. The estimated burden consists of time spent multiplied by implied hourly cost. These estimates may appear innocent but they actually have a direct impact on the government, such as agency head count and budgets. The estimate for Form 1040 is as follows: > [0] The average burden for taxpayers filing Form 1040 is about 15 hours and $280 If I add up my time as well as the tax accountant's time and fees to file taxes, this is quite underestimated. However, this is anecdotal evidence. What would be great is to have two fields on these forms where tax payers can enter the actual amount of time and expenses required to complete them, as part of the feedback. The agencies can then use the median to update their assumptions and act accordingly. [0] https://www.federalregister.gov/documents/2014/04/30/2014-09819/proposed-collection-comment-request-for-form-1040-and-schedules-a-b-c-c-ez-d-e-eic-f-h-j-r-and-se https://www.federalregister.gov/documents/2014/04/30/2014-09...

LyndsySimon 10y ago

My understanding is that the this doesn't apply to self-employment tax either - so if you're consulting you on the hook for that as well.

Spooky23 10y ago

The problem is that compliance is complex and enforcement random. Currency fluctuations can change your circumstances overnights. Also lots of catch-22 situations. People who are American by virtue of birth can but never live here can get into trouble when they coke to the attention of the tax authorities. Renunciation is also difficult and creates other issues.

FabHK 10y ago

I'd much appreciate if people who comment also mention in how many jurisdictions they have paid taxes, so that one has a frame of reference. > So the vast majority of Americans abroad are not paying taxes back to the US ($100800 / year is the cut off by the looks of it)[1]. Do you assume that he vast majority of Americans abroad are not making USD 100800? Because it doesn't say so in the source you provided.