The US taxation system contrasts almost all other countries around the world in that its citizens and green card holders have to file taxes for both local and foreign incomes and assets. However, American expats can take advantage of a number of tax exemptions to avoid double taxation if they still have to file taxes in their country of residence. These provisions include FEIE and FTC. Expats can claim either of them or both depending on their unique circumstances. Foreign assets such as bank accounts and investments have to be reported, as well as social security taxes. There are several IRS forms for filing taxes and exemptions, depending on the type of tax and exemption, respectively. The forms can all be downloaded, filed and uploaded for free from the IRS website. The catch though is on how to fill the forms, what to include and which form to use. You may also not know how to avoid penalties and how to accrue tax savings for your unique circumstances. That why you need to seek the help of a US expat tax specialist. Bright!Tax stands out as the leading US expat tax service provider for more than 9 million Americans living and working abroad. The firm employs full-time American CPAs specialized in IRS expat tax filing. Whichever company you decide to engage, ensure that their charges are transparent and get to know the final cost of your project before they start. Any other cost should come from the IRS. For instance, you may have accrued interest due to unpaid taxes. In this case, you’ll have to pay the interest and you may also have to pay an estimated tax payment for the coming year. The greatest unexpected cost when filing taxes is IRS penalties for failure to file or inaccurate filing. If you’ve never claimed any of the available tax exemptions, IRS will assume that you still owe taxes.
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