You can pay HKG tax and claim a foreign tax credit on your US taxes. You do not pay into Social Security or medicare (ever) as you work for a foreign employer. If you go that route, claim many exemptions so that your witholdings are low. No need to withhold for 2 countries at once. Or, you can pay your appropriate US taxes (excluding SS/Medicare) through normal withholdings and claim an exemption to HKG taxes (when you receive your return) and pay them nothing. You are forced to have US taxes withheld from your salary, how much is up to how many exemptions you claim. Even if you are in HKG over 60 days, yet pay taxes to a foreign country (USA), you will only be assesed on the days over 60. Your standard HKG exemptions will nullify what they determine you owe. So, simply put, you don't owe them anything. As far as wages in training, that's up to you...........My .02 worth, pay the USA and claim the exemption. You will end up paying less in tax if you have a mortgage and at least one child. Talk to a good tax accountant who understands working for a foreign company and having a "work office in HKG". You have more deductions with regards to commuting if your "work office" is not in the USA(no company mailbox). No matter what, you will pay less tax than working for a US company. The downside, no contribution to your Social Security retirement payout. hope this helps.........