Tag Archive for Americans Abroad

How To Live Outside The United States In An FBAR And FATCA World

John Richardson 3
When in Rome, live as a Homelander” does, when elsewhere, live as they live elsewhere.

Americans abroad are constantly told that they should “come clean”. They should file their U.S. taxes. This assumes that they are somehow “unclean” or perhaps “dirty”. The life of an “American abroad” is about three things:

1. “Thinking Clean” – The importance of “thinking clean” while living abroad. Read more

Got’cha! Delinquent Taxes Owed to IRS, Now Owed Indefinitely? What About Tax Non-Compliant Expatriates?

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It was recently reported in the press that the Social Security Administration was collecting old debts of many deceased persons by intercepting the tax refunds of their children. After much unwanted publicity, the Social Security Administration announced it would stop doing this with regard to debts that were over ten years old. What implications does this case raise for tax noncompliant expatriates?

The case of the Social Security Administration is quite alarming and raises serious concerns for persons with unpaid US tax liabilities. It is widely reported and recognized that there has been a vast increase in expatriations. I suspect that some expatriations will involve taxpayers who were not fully tax compliant and I foresee that this area is ripe for IRS audit and controversy. Read more

Americans Abroad – Selling the Principal Residence

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When it comes to considering gross income for tax purposes, Section 121 of the US Internal Revenue Code allows for the exclusion of up to $250,000 in gains arising from the sale of a “principal residence.” The exclusion should apply whether the property is in the US or a foreign country. In the case of married couples filing a joint return, up to $500,000 may be excluded. The tax law is very specific in how it defines a “principal residence”, and in the “ownership” and “use” requirements that form part of the definition for utilizing this exclusion.

Principal Residence under Section 121

In order for a property to qualify as a principal residence, the residence must have been owned and occupied by the taxpayer for a minimum of 2 years (specifically, 730 days) Read more