My fellow Americans!
Did you know?
All US citizens, regardless of what country they live in, are required to file a US tax return every year.
But why?
Successful tycoons were establishing homes in foreign countries with lower or no income tax to avoid paying US taxes. Unfortunately it's not just rich tycoons but every US citizen who has to file - and on top of that, it's illegal to renounce your US citizenship to escape taxes!
Will I owe tax?
The Foreign Earned Income Exclusion allows low and average earners not to pay tax. For 2010, if you earned less than $91,500 outside of the US you will pay no tax on this income.
If your earnings were over $91,500 you can claim a deduction for your UK taxes paid, which, along with the annual US standard deduction, means most UK residents will not owe US tax on their foreign income. You may owe tax on your US income, such as bank interest and Capital Gains.
I have been living overseas for several years and have not filed, am I in trouble?
If you have not filed after moving abroad, the IRS advises that you send in the last three years of returns. Penalties for late filing are based on a percentage of the tax owed, so if you owe no tax there will be no penalty.
What is the cost for this service?
Don't pay the £350 to £900+ other firms charge for US tax returns![1] Death and Taxes' expatriate tax service starts at just £150 per return for filers with income from employment and bank interest only, with discounts available for multiple years. There is no VAT chargeable. Death and Taxes has an accountant on staff with 20 years of experience filing US returns being an expatriate herself.
[1] Quotes obtained the week of 3rd October 2009.
