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So why is the IRS so concerned with US Expats? Well the US has the highest tax avoidance cost (circa $200 billion) in the world. So it makes sense that the IRS is continuously trying to find new ways, means, and methods to track US citizens who live or work abroad to make sure they […]

As a US American abroad, you may have heard a tax term called a “foreign source income” before. Perhaps you’ve even asked the question “What is foreign source income?” while reading one of our tax guides. Don’t worry – we’re going to make sure we will lay this all out for you. Foreign source income […]

Living Outside the United States If you are a U.S. citizen or resident alien and if you meet the following tests, you can elect the “foreign earned income exclusion.” First, you must have a “tax home” in a foreign country. This means your main place of business or employment must be in a foreign country […]

Resident or Non-Resident United States citizens living abroad generally must file a U.S. income tax return each year, even if they may exclude their income pursuant to the Earned Income Exclusion. In fact, timely filing of tax returns ensures that the benefits of the exclusion may be claimed. If you are a U.S. citizen living […]

Receiving a Bequest from Abroad If the value of aggregate foreign gifts that you receive during any year exceeds $10,000, you must report each foreign gift to the IRS. (The $10,000 figure will be increased for inflation after 1996.) A foreign gift is any amount you receive from a non-US person, which you treat as […]

Controlled Foreign Corporations (CFC’s) U.S. Citizens and Lawful Permanent Residents (i.e. Green Card holders) have unique income tax obligations, regardless of their country of residence, they must file United States income tax returns and international information returns annually. The U.S. income tax system is based on citizenship and lawful permanent resident status not just on […]

Tax Treatment for Persons Giving Up U.S. Citizenship to Avoid Taxation Internal Revenue Code – Section 877A The Heroes Earnings Assistance and Relief Tax Act of 2008 (P.L. 110-245) fundamentally changed the rules aimed at preventing expatriations in order to avoid U.S. tax by passing Code Sec. 877A. Unlike the old regime, which tracked an […]

Under the Affordable Care Act, the federal government, state governments, insurers, employers, and individuals are given shared responsibility to reform and improve the availability, quality, and affordability of health insurance coverage in the United States. Starting in 2014, the individual shared responsibility provision calls for each individual to have minimum essential health coverage (known as […]

Internal Revenue Service has concentrated efforts in recent years to ensure reporting of the existence of foreign holdings, and of income earned abroad or through foreign assets. Increasing numbers of U.S. taxpayers (U.S. citizen, green card holder, or lawful permanent resident of the U.S, or an entity established within the U.S., or which is owned […]

If you have retained a rental property in Canada while becoming a non-resident, Part XIII of the Income Tax Act levies a 25% withholding tax from the gross income from rentals.  Section 216 Election (Canada) The purpose of section 216 is to extend to non-resident persons the privilege of paying tax on their net income […]