Could American in HKG help!

[ASH1111]

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[stillalbatross]

Do you mean an american or being american or knowing american or looking american

Every American I have flown with thus far is paying tax in the US. Does that help?

[ASH1111]

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[boxjockey]

Once you are established in HKG for a full tax year, then you shouldn't have any problem with the Bona Fide test. You will have residence here, home here, bank account here, pay taxes here, etc. Now, try to figure out the international waters, days in the us, etc, that is the real fun....

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[ASH1111]

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[boxjockey]

No, it no longer applies, but you will have to pro-rate your deduction based on the amount of time spent in the US, over US territories, or international waters. Good luck with all of that, and go conservative.

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[flyinryan76]

I realize that this thread is somewhat dated now but I have a relevant question to follow up with the above statement. On average, what percentage of your total working time would you say is spent over international waters and the U.S. (or U.K. as the situation may be)? Would this work out (for tax purposes) to be about 50% of your income? More? Less?

[ASH1111]

Does "duty" scheduled through ANC, and back to HKG, count against the 330 days? Do any Americans on here have a good expat CPA you use in hkg? Really need some guidance, and recommendations. It seems to me that as an american, i will chew up my allowable days just with duty work, nevertheless any vacation time.

Does the 330/35 day thing apply still after you meet the Bona fide test?

Agg! help!

[Subwoofer]

The 330 days doesn't matter once you meet the bona fide residency test, so don't worry about that. The big issue though is the prorating. How much of your flight is spent over international waters (defined as more than 10 miles from a foreign country's shoreline)? For North American freight guys, I'd say that's a high percentage. That time and any time flying over the US can't be considered foreign-earned income.

It's a stupid system, especially if you're flying from HK to another non-US country because you still have to consider that non-foreign earned income.

As an SO, I requested a lot of Europe & NY/YYZ (lots of Canada & Russia time) trips. Add all of my ground duties in HK and I got about 75% foreign-earned and 25% int'l & US earned.

As an FO, it's a lot more foreign-earned. Phew.

[flyinryan76]

Thats good information subwoofer! Thank you! I am just starting to learn some of the ins and outs of the tax system as an expat and it is making me extremely frustrated and irritated with the U.S. tax laws.

Out of curiousity, do you, or anyone else for that matter, know if there is an easy way for the IRS to fact check that 75% or is it simply your word?

[Subwoofer]

Out of curiousity, do you, or anyone else for that matter, know if there is an easy way for the IRS to fact check that 75% or is it simply your word?

From the literature I have read, it seems American carriers supply their crews with a form that tells them how much time they have spent over foreign countries (based on flight planning), but obviously Cathay has no interest in tracking that. I suppose the IRS could ask to see your logbook, sample flight plans, etc., but I haven't known anyone here who has been audited so I can't tell you if they actually do that. I keep a spreadsheet with total DUTY time and duty time in/over foreign countries so at least there's some data they can reference if they ever decide to take a look.

[ASH1111]

So if i do a KAL, or PVG or BKK for example, that would all be foreign earned? So bid for local trips?

Subwoofer, do you turbotax all this, or do you have a cpa rec?

Thanks!

[flyinryan76]

I too would be interested to find out if anyone uses turbotax do their expat taxes!

[Subwoofer]

I used to use Turbotax my first year here, but I realized it's limited for this purpose and really not appropriate. Now I use a CPA who is an expat pilot working for Emirates. You can find him at AirlineCPA.com - AIRLINE CREW TAXES and PER DIEM (http://airlinecpa.com/). Good luck!

[airplaneridesrfun]

You should not be taxed for time spent over international waters if you are a bonafide resident of another country. However, if you use the 330 day test, you have to use the time over international waters in you daily count. Working in International waters is a term for oil rig workers; which might be where most of us should be! More money and more time off!

[Jaz and the Fat Man]

I've been using turbo tax for many years with no issues as long as you proceed slowly and read carefully. I used a CPA for a few years and when he got up to take a whiz, I glanced at his computer screen and he was using Turbo Tax and charging me 15,000 baht per..... I've been a bona fide resident for about 12 years and never run into a problem. With a family of 3 and no deductions except for the standard, I can make around 110K before I need to pull out the checkbook. More info at Internal Revenue Service (http://www.irs.gov) (bona fide resident)