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Where to find expertise, on foreign taxes
Old 06-07-2013, 08:02 PM   #1
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Where to find expertise, on foreign taxes

I have two friends (one IRL and the other internet) who are citizens of Canada, and New Zealand. They are considering returning home for a few years and possibly longer. One is a recent naturalized dual citizen, the other has a green card and is in the process of becoming a citizen.

They both are worried about the tax implications of working overseas.
I know just enough about filing foreign taxes, (mostly from reading this forum) to understand that subject is quite complex.

I was wondering if any of you current or relatively recent ex-pats, who have experience with filing taxes while overseas, could make a recommendations of where they could go to understand the issues. Websites, forums, books, or even what type of person are they should go to talk to. I.e are they better off finding a Canadian CPA who is familiar with US taxes in their hometowns, or a US immigration lawyer.
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Old 06-07-2013, 10:45 PM   #2
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This fellow may be of some help.

US Expatriate Tax Return Preparation by Tax Attorney CPA

His blog is here.
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Old 06-08-2013, 08:43 PM   #3
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Originally Posted by Onward View Post
This fellow may be of some help.

US Expatriate Tax Return Preparation by Tax Attorney CPA

His blog is here.

Thanks that is a pretty impressive website. Anybody actually used this guy?

Any other suggestions. In a similar thread, somebody suggested checking at an expat forum. I found this one for New Zealand. Any other suggestions?
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Old 06-08-2013, 10:54 PM   #4
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If your friends become US citizens their worldwide income will be subject to US even if they become non-US resident. If they move to another country they will also have to comply with local tax rules. The relevant tax treaty will prevent double taxation and provide a framework to rationalize the two systems.

If a US citizen moves abroad there are some basic rules to follow.

1) Don't invest in foreign mutual funds because they are very US tax inefficient
2) Make sure you don't fall foul of local tax rules that might restrict your ability to invest in US mutual funds
3) File FATCA and FBAR if required.
4) You can exclude around $95k of foreign earned income from US taxation and also take credit for any foreign taxes you pay.
5) Make sure you understand how the tax treaty deals with retirement funds, SS and double taxation.
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Old 06-08-2013, 11:00 PM   #5
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Thanks that is a pretty impressive website. Anybody actually used this guy?

Any other suggestions. In a similar thread, somebody suggested checking at an expat forum. I found this one for New Zealand. Any other suggestions?
Unfortunately most US expat tax preparers are not qualified to deal with taxes where the expat resides. A US expat tax return cannot be correctly filed without a thorough understanding of the relevant tax treaty and local tax codes. If too much tax is paid to the US the local tax authority will not necessarily give the tax payer credit for it. It's usually best to used a dual qualified tax specialist.
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Old 06-09-2013, 05:46 AM   #6
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If both friends will be US citizens, and therefore US expats residing abroad, have them search local (NZ and Canadian) US expat forums. The question concerning tax preparation will have been asked before. Prepare them for the cost implications of US tax preparation by qualified professionals located in the foreign country.

As with investing, as is constantly stressed on this site, the most important asset for an expat with tax reporting obligations is knowledge. It would be suggested that they read, research, re-read, and then do more reasearch on taxation for the US expat.

Do not assume that a tax advisor, located in the US, will have the requisite knowledge. There are some that are very good. Sadly, the majority are deeply lacking in the required expertise, and continualy prove it on professional tax forums.

An example within the last week: TaxAlmanac - A free online tax research resource and community - Discussion:Non Resident Taxation

There is no reliable 'quick read' sources for their situation. I hesitate to include the following link since it is directed for US expats in FRANCE, and the discussions are related to US/France tax compliance. It is a presentation of only the 'basics' for the US expat filer, and is recent (Jan. 2013). It's two hours long just covering the basics. (Follow the link to You Tube.)

Tax 101: An Introduction to Basic Tax Reporting Requirements for US Citizens Residing Abroad

Due to the increased emphasis placed on US expats by Congress and the IRS in the past 2 to 3 years in the US, and increased tax regulations in most foreign countries; anyone who claims tax filing for the US expat is simple is not up to date, and should re-evaluate their level of understanding.
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Old 06-09-2013, 06:18 AM   #7
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The following outfit specializes in expat tax prep and is highly recommended on an expat forum that I frequent. I have no personal experience with them myself so I can only pass along what I have read elsewhere. I will be trying them out this year though as I did just move from the U.S. to Mexico a couple of weeks ago.

Greenback Expat Tax Services

Good luck!
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Old 06-09-2013, 06:50 AM   #8
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I

I hesitate to include the following link since it is directed for US expats in FRANCE, and the discussions are related to US/France tax compliance. It is a presentation of only the 'basics' for the US expat filer, and is recent (Jan. 2013). It's two hours long just covering the basics. (Follow the link to You Tube.)

Tax 101: An Introduction to Basic Tax Reporting Requirements for US Citizens Residing Abroad
I'd like to reiterate that the video is particular to the US expat living in France. The taxation of a US expat is determined by US and local law AND the relevant tax treaty. As an example the video states that pension income paid to a US citizen in France is only taxed where the pension originates.....this would not be the case if the US citizen became resident in the UK. Canada and NZ will have their own particular arrangements.
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Old 06-09-2013, 08:36 AM   #9
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I'd like to reiterate that the video is particular to the US expat living in France. The taxation of a US expat is determined by US and local law AND the relevant tax treaty. As an example the video states that pension income paid to a US citizen in France is only taxed where the pension originates.....this would not be the case if the US citizen became resident in the UK. Canada and NZ will have their own particular arrangements.
An emphatic +1

I'm glad to see you caught that as well. I certainly replayed that short segment several times when I first viewed it. It's the reason I've never posted the link on any of the expat forums, which is a shame since the first hour is pretty informative.
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Old 06-09-2013, 06:19 PM   #10
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Thank you all very much, really helpful. I guess there is no Staples "Easy button"

I will pass the information on to my friends. The Canadian woman is in her 50s and has general idea that is a bitch. The NZ woman is her mid 20s, I think she may need a few drinks to absorb the shock.
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Old 06-09-2013, 06:35 PM   #11
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Each might find some tax help by looking at country specific "life as an expat" forums. There are just so many exceptions and unique situations it is hard to generalize. One source, fee based, will be local (there) US expat tax preparers. Their rates are typically lower than their counterparts at the big accounting firms.
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Old 06-10-2013, 07:18 AM   #12
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Each might find some tax help by looking at country specific "life as an expat" forums. There are just so many exceptions and unique situations it is hard to generalize. One source, fee based, will be local (there) US expat tax preparers. Their rates are typically lower than their counterparts at the big accounting firms.
+1
I agree, it's generally easier to find someone who can deal with US and NZ taxes in NZ, rather than finding a New Zealand tax expert in the US. Also your residence country is going to tax your local wages at source and if you can limit your US source income ad gains it often works out that you'll have no US tax due and a fairly simple US tax return.
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Old 06-10-2013, 08:13 AM   #13
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Originally Posted by clifp View Post
I have two friends (one IRL and the other internet) who are citizens of Canada, and New Zealand. They are considering returning home for a few years and possibly longer. One is a recent naturalized dual citizen, the other has a green card and is in the process of becoming a citizen.

They both are worried about the tax implications of working overseas.
I know just enough about filing foreign taxes, (mostly from reading this forum) to understand that subject is quite complex.

I was wondering if any of you current or relatively recent ex-pats, who have experience with filing taxes while overseas, could make a recommendations of where they could go to understand the issues. Websites, forums, books, or even what type of person are they should go to talk to. I.e are they better off finding a Canadian CPA who is familiar with US taxes in their hometowns, or a US immigration lawyer.
This is a common enough situation in Canada that there are many accounting firms who specialize in this area of practice. Many of them have offices on both sides of the border. Your friend should Google "US tax experts in Canada" and select some firms to interview.
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Old 06-10-2013, 10:48 AM   #14
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This is a common enough situation in Canada that there are many accounting firms who specialize in this area of practice. Many of them have offices on both sides of the border. Your friend should Google "US tax experts in Canada" and select some firms to interview.
Yes it will be far easier for the Canadian. There are even some particular IRS forms that deal with Canadian issues eg RRSPs on an 8891.
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