Caribbean News Now!

About Us Contact Us

Countries/Territories

Jump to your country or territory of interest

Advertise with us

Reach our daily visitors from around the Caribbean and throughout the world. Click here for rates and placements.

Contribute

Submit news and opinion for publication

Subscribe

Click here to receive our daily regional news headlines by email.

Archives

Click here to browse our extensive archives going back to 2004

Also, for the convenience of our readers and the online community generally, we have reproduced the complete Caribbean Net News archives from 2004 to 2010 here.

Climate Change Watch

The Caribbean is especially vulnerable to rising sea levels brought about by global warming. Read the latest news and information here...

Travel


Follow Caribbean News Now on Twitter
Connect with Caribbean News Now on Linkedin



News from the Caribbean:


Back To Today's News

US Expats and Taxes: The basics
Published on March 25, 2014 Email To Friend    Print Version

American expatriates are subject to US income taxes regardless of where they live and where they make their income. Furthermore, there are special requirements and issues to consider when it comes to tax return preparation. Over the next couple of months, we will be addressing some of the tax complexities faced by American expatriates living across the world.

US Taxes – Filing Requirements

In general, individuals with income <$9,750, or married couples filing jointly with income <$19,500 do not need to file (for 2013). However, the filing requirement is completely different for self-employed people. The threshold is a meager $400 in earnings.

Child Tax Credit (reason to file even if you are under the filing requirement)

Many expat families with children <17 years of age should file a return in order to take advantage of the child tax credit. As long as earned income is at least $3,000, there is a good chance you will qualify. Each child is worth up to $1,000 money back from the IRS even if you don’t owe any taxes.

Foreign Earned Income Exclusion and Foreign Tax Credit

Without doubt, the IRS filing requirements cast a wide net. However, many US expats end up not owing taxes because of certain exclusions and credits available to the expat community. The most important of these are the foreign earned income exclusion (FEIE) and foreign tax credit. With the FEIE, up to $97,600 of foreign earned income while living abroad is excludable from federal tax. The $97,600 works in conjunction with other deductions. As a result, one can have more than $100,000 in income, and pay no taxes. For married couples, both of whom are working, the exclusion amount is doubled. In order to qualify for the FEIE, one must meet be either the bona fide residence or physical presence test.

With the foreign tax credit, taxes are paid to a foreign country offset US tax liabilities. The foreign tax credit is normally utilized when one has paid income tax to a country with a higher tax rate than that of the US. For some expats in the Caribbean, the FEIE may be more applicable tool than the foreign tax credit.

Next article: Foreign Financial Account Reporting

This article was written by John Ohe (IRS Enrolled Agent and managing partner at Hola Expat). For more information, visit us: www.HolaExpat.com

Disclaimer: The answers provided in this article are for general information, and should not be construed as personal tax advice. Tax laws and regulations change frequently, and their application can vary widely based on the specific facts and circumstances involved.
 
Reads: 1847





Click here to receive daily news headlines from Caribbean News Now!



Back...

Comments:

No comments on this topic yet. Be the first one to submit a comment.

Back...

Send us your comments!  

Send us your comments on this article. All fields are required.

For your contribution to reach us, you must (a) provide a valid e-mail address and (b) click on the validation link that will be sent to the e-mail address you provide.  If the address is not valid or you don't click on the validation link, we will never see it!

Your Name:

Your Email:

(Validation required)

Comments:
Enter Code



Please note that, if you are using an AT&T domain email address, e.g. att.net, bellsouth.net, sbcglobal.net, the verification email will likely not be delivered. This is outside of our control and the only remedy seems to be for readers to complain to AT&T





Disclaimer
User comments posted on this website are the sole views and opinions of the comment author and are not representative of Caribbean News Now or its staff. Caribbean News Now accepts no liability and will not be held accountable for user comments.
Caribbean News Now reserves the right to remove, edit or censor any comments. Any content that is considered unsuitable, unlawful or offensive, includes personal details, advertises or promotes products, services or websites or repeats previous comments will not be approved.
Before posting, please refer to our Terms of Use and Privacy Policy.

The Caribbean Writer 2014


Other Headlines:



Regional Sports: