ARE YOU A WINNER OR LOSER UNDER THE NEW TAX LAW EFFECTIVE FOR 2018?

The winners under the new tax law are large corporations, the wealthy and in many situations small business owners.    As an expatriate there is now a new GILTI tax on your share of controlled foreign corporations, whether large or small.

The losers are those in high tax states (NY, California, Etc) and all taxpayers due to the skyrocketing deficit which increases by the minute due to high federal spending and not enough tax revenues to pay for it all.  READ MORE HERE FROM CBS NEWS

Need help?  email us at taxmeless@gmail.com. We know the tax law and how to help you.

Foreign Property Taxes and Interest on Foreign Real Estate ...Some Bad News

Foreign property (real estate) taxes aren't deductible on tax year 2018 through 2025 returns due to the Tax Cuts and Jobs Act. This rule applies to a personal residence or second property. In 2017 and prior years, foreign property taxes could be deducted.  Property tax deduction on foreign rental properties are subject to the same rules as your US rental property.

You can still deduct the mortgage interest on schedule A on foreign real  property that is your personal first or second home, assuming you meet the  limitations on interest deductions for personal residences and second homes

The maximum amount of taxes that can be deducted on Schedule A (for personal residences) plus state income taxes, vehicle license plates, sales tax, etc is limited to $10,000 per year for 2018 and beyond.

Keep in mind that to get any benefit from the deduction of medical expenses, state taxes, residence interest, and charitable deductions the total of all of those items must exceed the $24,000 standard deduction married couples get or $12,000 for those who file as single.  And remember you no longer get a personal exemption deduction for yourself, your spouse or your children.  That deduction is gone.

Need help with your tax return or planning for the future?  Email us at ddnelson@gmail.com. 

INDIVIDUAL AND CORPORATE TAXES IN COUNTRIES AROUND THE WORLD - FOR EXPATS

Need to know the income taxes, corporate taxes in the country you are living in or the country you plan to move to after you leave the USA to retire or work?   The links below will provide you with almost all the information you might need.

CORPORATE TAXES IN FOREIGN COUNTRIES

INDIVIDUAL TAXES IN FOREIGN COUNTRIES 

If you need assistance with planning your US tax when abroad, preparing the necessary returns, and other IRS or state tax matters contact us at ddnelson@gmail.com.  we specialize in US expatriate, nonresident and international taxes.

2018 YEAR END TAX PLANNING LETTER AND NEW EXPAT TAX LAWS

There is still time left before the end of 2018 to take steps to save taxes under the new tax laws enacted last year. READ AND DOWNLOAD OUT 2018 TAX PLANNING LETTER HERE.

Kauffman Nelson LLP, CPAs is a firm of CPAs and Attorneys with 30 years experience in US expatriate, international and US nonresident taxation.  We prepare your 2018 tax  return and assist you with planning, problems, audits, and all other US tax matters. Email us at taxmeless@gmail.com 

DOWNLOAD OUR 2018 EXPAT TAX RETURN QUESTIONNAIRE AND SEND IT IN FOR A FEE QUOTE HERE. GET STARTED EARLY AND SAVE TIME AND MONEY.  It is in MS Word Format to make it easy to complete on your computer or tablet.

2018 RATES, Standard Deductions and More - See What will Happen to You

 IRS Announces 2019 Tax Rates, Standard Deduction Amounts And More. READ MORE

HERE FROM FORBES MAGAZINE.  Need year end planning, email us at taxmeless@gmail.com. Attorney and CPAs will be there to help you find the best strategy.

2018 Expat Foreign Earned Income Exclusion and Housing Exclusion

 For 2018 the foreign earned income exclusion is $104,100. This applies to earned income from your work abroad and increases each year. Many IT, Tech, and Coding employees and self employed indivduals chose to live and work abroad to take advantage of his amazing tax break.

  If you live in a no tax or low tax country, you may not have to pay any tax on this much of your earned income if you are a bonafide resident of your home country or meet the physical presence test of  not going back to the US more than 35 days during any 12 month calendar or fiscal year period.  Read more about this exclusion and how to qualify and the additional deduction you can receive for your rental expenses and living expenses abroad (housing exclusion) in publication 54 READ IT HERE

Kauffman Nelson LLP CPAs have done tax return exclusively for US Expatriates and US Nonresidents for over 20 years.  We know the laws, and the recent changes implemented by the new tax laws enacted at the end of 2017.  Email us at taxmeless@gmail.com and visit our website at www.taxmeless.com for lots of useful tax information and tax savings.

New Tax Law - Get Your Divorce Now (before end of 2018) or later

If you finalize your divorce prior to the end of 2018, if you are the payer you can continue to deduction your alimony payment and your spouse must include those payments in is or her income for tax purposes.

HOWEVER, beginning in 2019 Alimony is no longer deductible to paying spouse and no longer taxable to receiving spouse. THEREFORE, depending on which side of the divorce you are on, you may want to hurry up and get it done now, or may want to delay until 2019.

BIG tax consequences.... see your divorce lawyer now!

Need help with your tax planning or returns?  Attorney and CPAs specializing in Expatriate, US International and US Nonresident taxation for 30 plus years.  Email us at ddnelson@gmail.com

New IRS Disclosure Procedures for Those With Undisclosed Foreign Assets and Unreported Foreign Income

The IRS ended the Voluntary Offshore Disclosure Program in September of 2018. This program was designed to allow those who  had  past unreported foreign income and unreported foreign assets to catch up with the IRS and reduce some penalties, and avoid the risk of criminal prosecution.

On November 20, 2018, the IRS announced new procedures which replaces the OSVDI and if chosen, could reduce many penalties and in many instances avoid criminal prosecution.  The link to the memo addressing this new procedure is below.

This program can be used by those who have much bigger hidden income and disclosure problems than could be address through the IRS streamlined program. If you decide to surface with the IRS using these new procedures best you use a tax attorney so your situation is kept confidential

READ THE NEW IRS RULES AND PROCEDURES HERE (download  IRS memo)

Contact Don Nelson, US International Tax Attorney with over 30 years experience at ddnelson@gmail.com if you wish to discuss your situation or learn more.  We have helped over a hundred clients with past unreported foreign assets and income catch up and resolve matters with the IRS.

DETERMINE IF YOU CONTRIBUTION WILL BE TO A RECOGNIZED CHARITY. BEFORE MAKING THE CONTRIBUTION

We all get asked to make contributions to recognized charities.  Often we have never heard of the

charity and sometimes if may not be one recognized by the IRS. Only charities which are recognized by the IRS will give you a charitable deduction on your tax return.  The IRS has a on line database which allows you to check out the name of all registered charities.   The link below will allow you to make certain your contribution is tax deductible and going for a good cause.

IRS DATABASE LISTING ALL RECOGNIZED NON PROFIT CHARITIES

Remember contributions to political parties, political organization and PACS are not deductible. Also with respect to foreign tax exempt charities the rules on whether or not the contribution can be deducted are complex and must be followed if you wish to get a deduction.  Those rules must be reviewed carefully to assure you contribution will produce a tax benefit.  See IRS publication 526

For 2018 and beyond you get a standard deduction on Schedule A of $24,000 if you file jointly or $12,000 if you file single. Therefore your taxes, medical expenses, charitable contributions, etc must exceed those amounts to give you any tax benefit.

Our firm offers mini consultations to help you resolve your tax problems, for planning and answer your tax questions. We are all US attorneys and CPAs. If you wish to have such a consultation email us at taxmeless@gmail.com.  Visit our website at www.taxmeless.com

NEW GILTI TAX ON CONTROLLED FOREIGN CORPORATIONS FOR 2018

If you own more than fifty percent of a foreign corporation holding real estate or operating a business

abroad, you now have to plan for the new GILTI tax (acronym)  IRC Section 951A resulting from the Tax Bill enacted in late 2017.   This tax applies to both large and small foreign corporations. In the past unless you had certain types of income, any net profits left in the corporation were not taxed on your personal return (or US corporate return if the foreign corporation is owned by your foreign corporation).  Now it is probable if there is a profit you will have to pay tax on the profits remaining at year end in your foreign corporation.

READ MORE ABOUT THE GILTI TAX  HERE IN AN EXCELLENT ARTICLE BY AN EXPERT - CPA  KYLE LODDER

Contact us at ddnelson@gmail.com if you want to plan for the tax, the impact of the tax, or avoiding it before the end of 2018.  Time is limited and after year end there is nothing you can do.