You'll be taxed internationally as a US citizen/PR for an income over a typical worker even if you don't live there anymore, so do beware. The USA is pretty much the only significant country does that.
This is trotted out all the time and the number of people it actually affects is miniscule.
* You are taxed on any income over $85,000.
* You can deduct any taxes you pay to the host government from your Federal Income tax.
The first and second apply to me and every year my US tax bill is 0.
Now, if I was making FU money it might be different, but most Americans working abroad never worry about this situation. Except if your Geitner, who just forgot.
>This is trotted out all the time and the number of people it actually affects is miniscule.
I think that's a bit of a misrepresentation. It's "miniscule" compared to the number of Americans living outside the country. Mainly because the majority of Americans living outside the country are in the military and not affected. There are various places in at least Europe where $85k is extremely easy to hit.
Further, it's not just the fact that you'll have to file this stupid tax form every year for the rest of your life. There is a new law that if you have more than $10k at any moment in time throughout the year you have to report the bank accounts that held the money. That's right. Even though you live and work in some other country, the US expects you to tell them your bank account information. Failure to comply results in a pretty hefty fine. Needless to say, even if you're willing to do this, you bank may not be. The end result is that it's damn inconvenient to be an expat. And it gets worse every few years.
Oh and did I mention that inheritance taxes still apply to you (when you die or when you inherit)?
Yes, I'm one of those Americans that has hit 85k repeatedly. But taxes in Europe is higher than they are in the US, 35% to 25% avg.
The last important line item is deduct the taxes you paid locally from your estimated US tax contribution. If you come out negative you owe the IRS 0. If you live anywhere in Europe 90% of the time you will hit 0.
>It's "miniscule" compared to the number of Americans living outside the country. Mainly because the majority of Americans living outside the country are in the military and not affected.
To me, the military doesn't count because 1) bases are treated as US territory they aren't taxed locally 2) Most military is tax exempt for duty and hazard pay. I'm referring to the 100,000 Americans in London and 50,000 in Paris. There are no US military presence in either of those cities and the US embassies can't hire them all.
>There is a new law that if you have more than $10k at any moment in time throughout the year you have to report the bank accounts that held the money.
This only applies to citizens living in tax shelters (ie Switzerland, Luxembourg, etc.) and if you are putting your money their and not honestly reporting it I have no sympathy at all when you get audited.
>Oh and did I mention that inheritance taxes still apply to you (when you die or when you inherit)?
Can't forget inheritance tax. Ole Dubya had to repeal it even though it only applied to his billionaires club.
>But taxes in Europe is higher than they are in the US, 35% to 25% avg.
In "Europe"? You mean parts of Europe or even most of Europe. In Switzerland, Lichtenstein, etc., it's lower.
>This only applies to citizens living in tax shelters (ie Switzerland, Luxembourg, etc.)
Uh... why do you think that is, eh? Think about that for a minute.
>and if you are putting your money their and not honestly reporting it I have no sympathy at all when you get audited.
Oh yea? If I live and work there and happen to put my money where I live and work you have no sympathy for me not wanting the US to bother me about it? Why does the US need to know? Why is it there business? I don't use their resources. No other first world country does anything like this and there is no excuse.
I'm sure there are a lot of shit stupid things certain people in America will say. But there is so little evidence for this point of view that it's breathtaking to even hear it uttered.
Where to?