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Your situation isn't normal. You need to be making quite a bit of money to be taxed. If you don't have any desire to return to the US why not just ignore it?

by R0b0t1 6y ago

nvarsj 6y ago
The taxes are the least of it. The expense and time it consumes to file the various forms is a huge pain. Anyone who has investments, a business, or property abroad will suffer from this. My net taxes were very low, but I have spent thousands on accountancy fees and hundreds of hours of my own personal time. GILTI was just the latest landmine. I net in the low 6 figures, via my own consultancy. I have a one man shop which basically incurs the wrath of the IRS because it doesn't fit into the IRS tax code worldview. This is not abnormal, in fact many experienced software people in the city work this way. I also can't just ignore it. The IRS under the Obama administration launched one of the most aggressive foreign tax ramp ups ever. With FBAR/FACTA, they know everything you have. It is incredibly risky to ignore filing and paying your US tax obligation - they can do all kinds of horrible things, with minimum 10k penalties and foreign agreements in place for enforcement. Plus I have retirement accounts in the US which could be affected.
- R0b0t1 6y ago
  You don't have to come back to the US. If it's not worth it to do so, don't. But if it is keep filing your taxes. I could see improving things but your perspective still sounds like whinging. Accounting and filing is the cost of doing business. More troublesome is the SS and other tax contributions you're responsible for, but that just means you should charge more. To give you a comparison, this sounds to me like people stating we should wipe out student debt. Doing so is inherently regressive. Already well off people go to college anyway and people with a degree make more over their lifetime. They are not the people who need help the most. Likewise, if you are encountering serious financial strain because of this you need to charge more, but you're still making more than most people do.
academia_hack 6y ago
Even paying zero dollars you still have to file taxes, send in FBAR, invest in a FACTA compliant way, sort out redundant pensions, and deal with the IRS - all at comically inflated costs since software products (e.g. Turbotax) don't do overseas taxes well, if at all. And if you make a mistake navigating an incredibly complex web of under-documented treaty law and ambiguous paperwork you can quite literally end up imprisoned by a country with one of the developed world's most comically broken justice systems the next time you go on holiday. I once won a random prize drawing for a modest amount of cash ($15k) and ended up paying nearly $3k in accountant fees to navigate the double-taxation process safely. My US tax burden was $0, but the filling burden was way beyond that. I haven't benefited from US public services or anything in many years. The US is essentially the only country on the world that inflicts this nonsense on people.

Your situation isn't normal. You need to be making quite a bit of money to be taxed. If you don't have any desire to return to the US why not just ignore it?

by R0b0t1 6y ago

Your situation isn't normal. You need to be making quite a bit of money to be taxed. If you don't have any desire to return to the US why not just ignore it?

nvarsj 6y ago

The taxes are the least of it. The expense and time it consumes to file the various forms is a huge pain. Anyone who has investments, a business, or property abroad will suffer from this. My net taxes were very low, but I have spent thousands on accountancy fees and hundreds of hours of my own personal time. GILTI was just the latest landmine. I net in the low 6 figures, via my own consultancy. I have a one man shop which basically incurs the wrath of the IRS because it doesn't fit into the IRS tax code worldview. This is not abnormal, in fact many experienced software people in the city work this way. I also can't just ignore it. The IRS under the Obama administration launched one of the most aggressive foreign tax ramp ups ever. With FBAR/FACTA, they know everything you have. It is incredibly risky to ignore filing and paying your US tax obligation - they can do all kinds of horrible things, with minimum 10k penalties and foreign agreements in place for enforcement. Plus I have retirement accounts in the US which could be affected.

R0b0t1 6y ago
You don't have to come back to the US. If it's not worth it to do so, don't. But if it is keep filing your taxes. I could see improving things but your perspective still sounds like whinging. Accounting and filing is the cost of doing business. More troublesome is the SS and other tax contributions you're responsible for, but that just means you should charge more. To give you a comparison, this sounds to me like people stating we should wipe out student debt. Doing so is inherently regressive. Already well off people go to college anyway and people with a degree make more over their lifetime. They are not the people who need help the most. Likewise, if you are encountering serious financial strain because of this you need to charge more, but you're still making more than most people do.

academia_hack 6y ago

Even paying zero dollars you still have to file taxes, send in FBAR, invest in a FACTA compliant way, sort out redundant pensions, and deal with the IRS - all at comically inflated costs since software products (e.g. Turbotax) don't do overseas taxes well, if at all. And if you make a mistake navigating an incredibly complex web of under-documented treaty law and ambiguous paperwork you can quite literally end up imprisoned by a country with one of the developed world's most comically broken justice systems the next time you go on holiday. I once won a random prize drawing for a modest amount of cash ($15k) and ended up paying nearly $3k in accountant fees to navigate the double-taxation process safely. My US tax burden was $0, but the filling burden was way beyond that. I haven't benefited from US public services or anything in many years. The US is essentially the only country on the world that inflicts this nonsense on people.