Americans who move abroad still have to file federal tax returns and pay any amounts due, but thanks to the Internet it is much easier than it used to be for US expats to get assistance from tax professionals who have experience in international tributary law.
An international CPA and international tax attorney can be an expat’s best allies in preparing an effective strategy that maximizes the many legal exclusions, write off’s and or breaks available to expats while meeting all regulatory requirements.
The US tax code is highly complex and runs to 75,000 pages at last count. Some of its most complicated and detailed provisions are those governing the rights and responsibilities of US citizens living overseas. An international tax attorney can ensure that an expat’s tributary strategy incorporates every possible option for experiencing lower tariffs.
An expat who sets up a legal entity in the country of residence, for example, can be receive a salary from it without the income being subject the US self-employment tax. When setting up a foreign entity it is definitely advantageous to have an international tax attorney guiding the process, to help ensure the right choice of legal structure and other considerations.
An international tax attorney can advocate for the US expat in the event of any IRS challenge to the taxpayer’s tax return or supporting documentation. The expat is showing a form of “due diligence” by having an experienced international tax attorney advise him or her, and this alone can have a positive influence on the outcome of a conflict with the IRS.
To be most effective, an international tax attorney should be part of an expat’s tax strategy team, rather than someone who gets a call only when things with the IRS adversarial. Legal problems are avoidable if an expat’s tax planning includes input from international accounting and legal veterans. Most tax problems could have been avoided with better planning and an international tax attorney can spot potential trouble spots in an expat’s overall tax picture before they become major disruptions.
There are criminal penalties for not filing tax returns and civil penalties for not paying taxes due, so it makes sense to have an international tax attorney as part of one’s tax preparation team. Complying with the filing deadlines and the special qualifying criteria that apply to expats requires expertise. One firm that specializes in expat tax issues is Tax Planner CPA, which has a website that is a good introduction to many aspects of expat taxation.
The site (now offline) did include a Q&A section where visitors once could have their expat tax questions answered by a team of CPAs and an I.T.A.
About the Author
David Odom is a US Citizen who during his trip to India was informed about his requirement to still File US taxes in spite of not having US income.Since then, he began investigating expatriate taxation and now writes articles on the subject – so that fellow Americans don’t run into the same issues as he did of (international tax attorney).