U.S. Expats or Expatriates
- (U.S. citizens and U.S. green card holders living and working outside the U.S.).¬†U.S. Expats¬†or Expatriates¬†are taxable on worldwide income for their lifetime, unless they expatriate- surrender their U.S. citizenship or Legal Permanent Residence or green card.
- There are opportunities for the U.S. Expat or Expatriate to avoid double taxation through the use special exclusions- the¬†Foreign Earned Income Exclusion (FEIE), Housing Exclusion (HE)¬†(Employed) or¬†Housing Deduction (HD)¬†(Self Employed) available on Form 2555- Foreign Earned Income and¬†Foreign tax credits (FTC)¬†available on Form 1116- Foreign Tax Credit, may be considered if the foreign country has a foreign income tax.
- For U.S. Expats or Expatriates to use the¬†FEIE,¬†HE¬†or¬†HD¬†and¬†FTC¬†they must first qualify by meeting certain criteria/ tests and subsequently file a tax return to receive these benefits. Additionally under the¬†Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA) ‚Äústacking‚ÄĚ must be considered. The interplay mechanism between the¬†FEIE,¬†HE¬†and¬†HD¬†and FTC¬†are highly complex filings involving complex terminology and only competent international tax CPA‚Äôs (Certified Public Accountants) should attempt these filings.
- Protax‚Äôs¬†services include consultations on and / or explanations of your various U.S. Expat or Expatriate compensation packages, including that as pertains to individual¬†tax equalization or tax protection¬†arrangements.
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