Working overseas comes with complex tax duties, including income reporting, foreign accounts disclosure, and understanding the interplay between U.S. tax laws and foreign tax systems.  In this overview, we will cover:

  • Challenges and opportunities in international taxation for U.S. citizens
  • Key tax terms and concepts for Americans working abroad
  • Planning ahead for tax compliance across borders

The Foreign Earned Income Exclusion (FEIE)

  • Eligibility Requirements for FEIE
    • Qualifying for the exclusion via the physical presence or bona fide resident test
  • Calculating the Exclusion
    • How to figure the exclusion amount and apply it to your taxes
  • Claiming Housing Exclusion or Deduction
    • Additional benefits for housing costs overseas

Tax Treaties and Avoiding Double Taxation

  • Understanding Tax Treaties
    • How treaties affect U.S. expats
  • Foreign Tax Credit (FTC)
    • Claiming credit for taxes paid to foreign governments

Foreign Accounts and Assets Reporting

  • Foreign Bank and Financial Accounts (FBAR) Reporting
    • Requirements for disclosing foreign financial interests
  • FATCA Requirements
    • Reporting assets under the Foreign Account Tax Compliance Act

Planning for Social Security and Medicare

  • Impact on Social Security Benefits
    • Working abroad and your U.S. Social Security eligibility
  • Medicare Tax Obligations
    • Continuing Medicare contributions while working overseas

Employment Considerations

  • Self-Employment Tax for Overseas Work
    • Paying Social Security and Medicare taxes as an expat
  • Employer-Provided Benefits
    • Tax implications of benefits provided by international employers

Retirement Planning Abroad

  • Contributing to Retirement Accounts from Abroad
    • Rules for contributing to IRA and 401(k) plans while overseas

Final Thoughts

  • Pre-departure tax checklist for overseas workers
  • IRS forms and publications for reference
  • Importance of consulting with a tax expert specialized in expatriate issues

Detailed Bullet Points for the IRS Sections:

  • IRS References:
    1. FEIE: IRS Publication 54 and Form 2555
    2. Tax Treaties: IRS Publication 901, U.S. Tax Treaties
    3. FBAR: FinCEN Form 114, Report of Foreign Bank and Financial Accounts
    4. FATCA: IRS Form 8938, Statement of Specified Foreign Financial Assets
    5. Self-Employment: Schedule SE (Form 1040)
    6. Retirement Contributions: IRS Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs)