US IRS rules, regulations and laws, for US Citizens, Americans, green card holders, and nonresidents living abroad or moving to the US or out of the US.... valuable information on IRS rules concerning U.S. expatriates and their tax returns, and tax planning.... by an experienced International Tax Attorney
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September 12, 2017
Determining if FBARS (forms 114, TDF 90-22.1) were filed for Prior Years or Securing Copy of Prior Year Filed FBARS
September 7, 2017
IRS Streamlined Program - Allows you to Surface with IRS with limited Penalties, and Exposure
Eligibility for the Streamlined Foreign Offshore Procedures
Example 3: Ms. X is not a U.S. citizen or lawful permanent resident, was born in France, and resided in France until May 1, 2012, when her employer transferred her to the United States. Ms. X was physically present in the U.S. for more than 183 days in both 2012 and 2013. The most recent 3 years for which Ms. X’s U.S. tax return due date (or properly applied for extended due date) has passed are 2013, 2012, and 2011. While Ms. X met the substantial presence test for 2012 and 2013, she did not meet the substantial presence test for 2011. Ms. X meets the non-residency requirement applicable to individuals who are not U.S. citizens or lawful permanent residents.
August 31, 2017
Criteria IRS uses for FOREIGN EARNED INCOME EXCLUSION - IRS NOW FORCING YOU FOLLOW RULES (FORM 2555)
https://docs.google.com/document/d/e/2PACX-1vS-i3toACXWWJXyzfeEAoOgVpJOsI23tMCohLL8ICV-yX4A4X06WwzREBKKbLH0gpZe18Y2TznNiLiu/pub
If you need help because the IRS has disallowed your expat foreign earned income exclusion we may be able to help. Email us at ddnelson@gmail.com
July 26, 2017
One Financial Mistake That Can Cost Expats Living Abroad Millions - and We See This All Too Often When We do Tax Returns
Too many expats and others living abroad keep all of their savings and investments in low interest paying bank or savings accounts in the USA. This is historically a big mistake. It is understandable that you want to keep your funds in the USA, because the banks and currency in your country of location may not be stable or safe. However, other than some reserves a US bank account is not the answer.
Investing in the stock market (over the long run and in good conservative companies) and real estate (in areas where history shows the values will increase significantly in the future - Such as California) will give you a nest egg on retirement of 3 to 4 times the amount you will have if you just keep it all in a bank earning interest. The worst place to keep it as you can see in the following article is under your mattress.
Read More in the following Washington Post article http://wapo.st/2ucJSBq
Remember also, investments in stocks and real estate abroad is mostly treated the same for US tax purposes as investing in US stocks and bonds. However, investing in foreign mutual funds can result in you having to pay higher taxes (thanks to the US Mutual Fund Lobby). Want to discuss your investment and tax strategy. Email Don at ddnelson@gmail.com. We have assisted hundreds of clients on their way to accumulating retirement wealth.
July 12, 2017
WHEN YOU RECEIVE A LETTER FROM THE IRS
Tips on How to Handle an IRS Letter or Notice
The IRS mails millions of letters every year to taxpayers for a variety of reasons. Keep the following suggestions in mind on how to best handle a letter or notice from the IRS:
Do not panic. Simply responding will take care of most IRS letters and notices.Do not ignore the letter. Most IRS notices are about federal tax returns or tax accounts. Each notice deals with a specific issue and includes specific instructions on what to do. Read the letter carefully; some notices or letters require a response by a specific date.Respond timely. A notice may likely be about changes to a taxpayer’s account, taxes owed or a payment request. Sometimes a notice may ask for more information about a specific issue or item on a tax return.
A timely response could minimize additional interest and penalty charges.If a notice indicates a changed or corrected tax return, review the information and compare it with your original return. If the taxpayer agrees, they should note the corrections on their copy of the tax return for their records. There is usually no need to reply to a notice unless specifically instructed to do so, or to make a payment.Taxpayers must respond to a notice they do not agree with. They should mail a letter explaining why they disagree to the address on the contact stub at the bottom of the notice. Include information and documents for the IRS to consider and allow at least 30 days for a response.
There is no need to call the IRS or make an appointment at a taxpayer assistance center for most notices. If a call seems necessary, use the phone number in the upper right-hand corner of the notice. Be sure to have a copy of the related tax return and notice when calling.Always keep copies of any notices received with tax records. The IRS and its authorized private collection agency will send letters and notices by mail. The IRS will not demand payment a certain way, such as prepaid debit or credit card. Taxpayers have several payment options for taxes owed.
Need help understanding a notice or responding to the IRS (or state tax agency). Email us at ddnelson@gmail.com and attach a copy.
July 8, 2017
Plan Ahead for Tax Time When Renting Out Residential or Vacation Property Outside of USA
Good News - You do get foreign tax credits for income taxes paid in foreign countries which will offset your US taxes on the same income dollar for dollar. Other taxes you pay may be deductible as rental expenses. Most states do not allow a foriegn tax credit on state returns.
- Tax Topic 415 – Renting Residential and Vacation Property
- Rental Income and Expenses – Real Estate Tax Tips
- Is My Residential Rental Income Taxable and/or Are My Expenses Deductible? IRS
Email us for US tax and legal planning for the rental of your foreign property or its sale or purchase. Planning ahead can often avoid tax problems later. ddnelson@gmail.com Also visit our website at www.taxmeless.com
June 20, 2017
Understanding the benefits of trusts for US expats and nonresidents with US assets from Fidelity
Need help with a US trust or Will to dispose of your US assets, contact ddnelson@gmail.com. If you have assets located in the country you live in abroad, best to hire a local attorney to draw up the property documents to transfer those assets upon your demise.
June 12, 2017
Taxpayers Abroad Must File by June 15; Extensions Available; New Filing Deadline Now Applies to Foreign Account Report
May 28, 2017
You Can File a Joint Return with Your Nonresident /Noncitizen Spouse- Here is how.
April 26, 2017
EXPATRIATES WHO OWE LOTS OF BACK TAXES CAN DO AN OFFER IN COMPROMISE WITH THE IRS
- In general, the IRS cannot accept a settlement offer if the taxpayer can afford to pay what they owe. Taxpayers should first explore other payment options. A payment plan is one possibility. Visit IRS.gov for information on Payment Plans – Installment Agreements.
- A taxpayer must file all required tax returns first before the IRS can consider a settlement offer. When applying for a settlement offer, taxpayers may need to make an initial payment. The IRS will apply submitted payments to reduce taxes owed.
- The IRS has an Offer in Compromise Pre-Qualifier tool on IRS.gov. Taxpayers can find out if they meet the basic qualifying requirements. The tool also provides an estimate of an acceptable offer amount. The IRS makes a final decision on whether to accept the offer based on the submitted application.
- Taxpayers wishing to file for an Offer in Compromise should visit IRS website’s Offer in Compromise page for more information. There taxpayers can find step-by-step instructions as well as the required forms. Taxpayers can download forms anytime at www.irs.gov/forms or call 800-TAX-FORM (800-829-3676) and ask for Form 656-B, Offer in Compromise booklet.
- Tax Topic 204- Offers in Compromise
- Offer in Compromise – English
April 24, 2017
New Form 5472 Filing Requirements for Foreign-Owned U.S. Disregarded Entities (“FOUSDEs”) - International Tax Blog
New Form 5472 Filing Requirements for Foreign-Owned U.S. Disregarded Entities (“FOUSDEs”) - International Tax Blog
If you need help filing this form or information on it email us at ddnelson@gmail.com
April 10, 2017
April 8, 2017
Cut IRS Audit Risk, Extend your April 18 IRS Tax Deadline To October 16
Several years ago an IRS agent confidentially to us that returns are audited in the order they are picked for audit (filing early or on time would cause your return to be picked first) and those filed later under extension are not as likely to be audited because the limited audit staff might not get around to auditing those returns filed undertension because they are busy with returns filed earlier in the year.
Read more in the Forbes article below.
Cut IRS Audit Risk, Extend April 18 Tax Deadline To October 16
If you have questions, are being audited or ? email us at ddnelson@gmail.com