US Taxes
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Joined: Sep 2003
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From: California
US Taxes
I am about to start working overseas. Does anyone know how to get out of paying US income tax legally? On the irs web site, it says that you have to spend more than 330 days outside of the country. I have already spent most of this year in the US. It also sounds like I may have to return to the US for training and that might put me over the limit for next year. Someone help please, I'm broke!!!
Joined: May 2003
Posts: 6
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From: Tennessee
PP108-
Not sure how much you will be making, but you can probably exclude some of that income from taxes. The IRS now allows up to $80,000 of foreign income to be deducted from US tax liability. I am sure there are probably other ways to get even more deductions, but this is the simplest method.
Here is the IRS website with some of the information. Its for returns in the year 2002, but I am sure it will be similar for 2003. Couldn't find info for 2003, it might not have been released yet.
http://www.irs.gov/pub/irs-pdf/p54.pdf Page 11 has much information of this deduction.
Good luck
Husq
Not sure how much you will be making, but you can probably exclude some of that income from taxes. The IRS now allows up to $80,000 of foreign income to be deducted from US tax liability. I am sure there are probably other ways to get even more deductions, but this is the simplest method.
Here is the IRS website with some of the information. Its for returns in the year 2002, but I am sure it will be similar for 2003. Couldn't find info for 2003, it might not have been released yet.
http://www.irs.gov/pub/irs-pdf/p54.pdf Page 11 has much information of this deduction.
Good luck
Husq
Joined: May 2000
Posts: 896
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From: US
Propilot108, I live and work in Europe and have a little knowledge on this subject.
There are two ways to qualify:
1. Remain outside the U.S. for 330 days in any one year period (not tax year, not fiscal year, just a year)
2. Or, establish residency outside the U.S.
The IRS publication mentioned above pretty much explains all of this. Even if you make more than $80K, only the amount in excess is taxable, but standard deductions or itemized deductions should eliminate any tax burden.
There are two ways to qualify:
1. Remain outside the U.S. for 330 days in any one year period (not tax year, not fiscal year, just a year)
2. Or, establish residency outside the U.S.
The IRS publication mentioned above pretty much explains all of this. Even if you make more than $80K, only the amount in excess is taxable, but standard deductions or itemized deductions should eliminate any tax burden.
Joined: Nov 2001
Aviation Qualifications: SLF
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From: Not sure now
Good information from the above two posters. Another alternative is to use the daily per diem rates for overseas travel as a deduction. A friend who works for an overseas company but is " based " in Los Angeles does this and it comes awefully close to the $80,000 deduction.
For those using the $80,000 deduction please write to your Congressman and Senators and ask them to keep the deduction. There was a move this year to repeal that provision and I fear it will happen again as Bush is running a massive deficit and will look to make money from an easy mark. As overseas residents we don't actually have a Congressman or Senators so for them to repeal the deduction isn't going to cost them a vote.
A good CPA for travel industry employees is in L.A.
www.pilotax.com or www.mkappcpa.com
Typhoonpilot
For those using the $80,000 deduction please write to your Congressman and Senators and ask them to keep the deduction. There was a move this year to repeal that provision and I fear it will happen again as Bush is running a massive deficit and will look to make money from an easy mark. As overseas residents we don't actually have a Congressman or Senators so for them to repeal the deduction isn't going to cost them a vote.
A good CPA for travel industry employees is in L.A.
www.pilotax.com or www.mkappcpa.com
Typhoonpilot
