As an American living abroad it is essential that you stay in like with your US tax obligations in order to avoid unnecessary penalties and stress. This article offers a guide on what documents American Expats need in order to file their US expat tax returns. These documents are not only necessary to finalize your US expat tax return, but also to protect yourself in the event of an Audit from the IRS.Read More
As a American living in the UK it is normal and expected to become homesick from time-to-time. While the Americans and English have many similarities in terms of lifestyle and interests, there are always going to be some differences that are likely to make any American feel slightly homesick.
Britain may well have one of the best tea selections in the work, however many Americans wake up craving nothing but an an omelet and a hot cup of filtered coffee.
Below we have put together a guide on London’s top spots for any homesick American living in the London:Read More
Under the Tax Relief and Job Creation Act of 2010, the energy efficient appliance credit was modified and extended. This means that tax credit can be claimed for each type of qualified energy efficient appliance produced by the taxpayer during the 2011 calendar year ending with or within the taxpayer’s taxable year.Read More
As an SME in the Creative Industry in the United States, they are eligible to certain tax reliefs. Like all SME’s in the US, an enterprise is eligible to a tax deduction for qualifying charitable donations.Read More
As a US accountant to creative industry professionals, we understand that travel and varying bases is a huge factor of many creative industry jobs. Whether you’re an actor who has had to move to the other end of the country for a production contract, or a musician that is touring the US, we are expert in your tax matters.
On May 25th 2018, the IRS announced several changes in the Tax Cuts and Jobs act that affect moving, mileage and travel expenses.Read More
The IRS have recently announced that eligible US employers who provide family and medical leave to their employees may qualify for a new business credit for the 2018 and 19 tax years.
Eligible employers that have set up certain paid family leave programs or amend existing programs by December 31st, 2018 will be eligible to claim the new employer credit.
The details of the family and medical leave credit were published in Notice 208-71 and clarifies how to calculate the tax credit. The credit is equal to a percentage of wages paid to qualifying employees while they are on family and medical leave. Generally, this amount should not exceed $72,000 for the credit to be claimable.
Are you eligible?
In order to be eligible to claim the credit, you must have a written policy that satisfies certain requirements:
· The policy must cover all qualifying employees who have been employed for a year or more and were not paid more than a specified amount during preceding year. Generally speaking, the employee must not have had compensation from the employee of more than $72,000 in the 2017 tax year.
· The policy must provide at least 2 weeks of annual paid family and medical leave for each qualified full-time employee and at least a proportionate amount of leave for each qualified part-time employee
· The policy must provide payment of at least 50% of the qualifying employee’s wages while the employee is on leave.
· For employers who employ qualified employees who are not covered by title I of the FMLA, your policy must include language providing ‘non-interference’ protections.
Please not that if any leave that is paid by a State, local government or local law is not taken into consideration for any purpose in determining the amount of paid family and medical leave provided.
On September 28th 2018 the OVDP (Offshore Voluntary Disclosure Program) will be closed. Previously, OVDP was used as a resolution for taxpayer with exposer to potential criminal liability or/and civil penalties due to a willful failure to report foreign financial assets and pay tax due to those assets.
While active, over 56,000 taxpayers have used OVDP. For those who remain outside of compliance after September 28th that cannot file under other tax programs there may be major ramifications to the end of OVDP.
Penalties for Non Compliance:
Failure to File FBAR (Non-willful) – Up to $10,000 per violation
Failure to File FBAR (Willful) – As high as $100,000 or 50% of the total values per violation
Failure to File Form 8938 – $10,000, with an additional $10,000 each month after the IRS has notified the taxpayer, up to a max of $50,000
Failure to File Form 3520A – Greater of $10,000 or 5% of the gross value of the trust’s assets
Failure to File Form 5471 – $10,000, with an additional $10,000 each month starting 90 days after the IRS has notified the taxpayer, up to a max of $50,000
Failure to File Form 5472 – $10,000, with an additional $10,000 each month starting 90 days after the IRS has notified the taxpayer, up to a max of $50,000
Failure to File Form 8865 – $10,000, with an additional $10,000 each month starting 90 days after the IRS has notified the taxpayer, up to a max of $50,000
Failure to File Form 962 – 10% of the property transferred up to $100,000 per return if non-willful, no limit if willful
Fraud (Underpayment of Tax, Failure to File) – Up to 75% of the unpaid tax
Failure to File – 0.5% of tax, plus 0.5% each additional month, not to exceed 25%
Accuracy-Related Penalties – 20% or 40% on underpayment of tax
Tax Evasion – Prison Term up to 5 years and a fine up to $250,000
False Returns – Prison Term up to 3 years and a fine up to $250,000
Failure to File Tax Return – Prison Term up to 1 year and a fine up to $100,000
Failure to File FBARs – Prison Term up to 10 years and a fine up to $500,000
Attempts to Defraud the Government – Prison Term up to 10 years or more and a fine up to $250,000
Just like US Citizens and Green Card holders, US businesses must report and pay tax on their worldwide income. The individual filing requirements of each entity can be dependent on a number of factors. This article aims to break down the basics of the filing requirements for common types of foreign entities.
With the huge tax hikes introduced by the US over the last 5 years has brought more and more US citizens living abroad deciding to get rid of their American citizenship once and for all.
Can you renounce your US citizenship?
So you think you want to renounce your US citizenship? A person wishing to renounce his or her U.S. citizenship must voluntarily and with intent to relinquish U.S. citizenship:Read More
If you missed the June 15th tax deadline there are a number of steps you can take to get back on track. We are expert on assisting US expats on all of their tax matters and concerns.
In order to get compliant with your US taxes, there are a number of steps you should take.Read More
According to sources reported in The Telegraph, the Treasury is considering the dividend allowance in the Autumn Budge 2018, which will be released on the 22nd November 2018. It will be no shock to most if cuts are once again made against business owners, directors and shareholders hand. The same was done in the Autumn Budget 2017 when the dividend allowance was cut from £5,000 to £2,000.
As an accountant to film companies and professionals in the US we are expert in film industry tax exemptions and reliefs. One of the major tax reliefs available to film companies is the Film Production Tax Credit, which allows a tax credit of 30% on qualified costs incurred in New York State for eligible productions.
As the owner of an ecommerce business that works in the US, it is important to have an in-depth understanding of US corporate taxes. A growingly important and complex area of tax for ecommerce businesses in the US is Sales Tax.Read More
As an American entrepreneur living abroad there are several tax considerations you should make before starting a business overseas.
Below we have put together a summary of the US tax implications of being a self employed US expat abroadRead More
As an American Citizen living in Canada it is likely that you are obligated to file a US Expat tax return every year. There are a number of forms you may be obliged to depending on your residency status, level of income and source of income.
As a US citizen living and working outside of the US, it is often possible to exclude part- or even all of your foreign income and self-employment income from federal tax through the Foreign Earned Income Exclusion (FEIE).Read More
As an American living abroad, US taxes can be complex. We have had a brief look at some of our US expatriate tax cases to identify common US tax mistakes and make recommendation on how to avoid them.
A deduction/exclusion that is massively under claimed amongst US expatriates is the Foreign Housing Exclusion/deduction. The exclusion/deduction works in conjunction with the Foreign Earned Income Exclusion (FEIE) and is an allowance that includes some of your housing expenses from your gross income on your US tax return.
The allowance is deductible at different thresholds depending on where you live and how many days you have lived outside of the US.
The Foreign Earned Income Exclusion (FEIE) is a deduction that the IRS allows to certain US citizens and resident aliens living and earning income abroad on a consistent basis.
What is foreign earned income?
Foreign earned income is classed as income from either employed or self-employed work. It does not include passive income from investments such as interest, dividends, IRA distributions or rental income.
A few examples that the IRS (taxpayers) have given includes on what doesn’t qualify as foreign income includes:Read More