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Friday, April 16, 2010

IMPORTANT tax info to know as an American living abroad

First, a rant:

So, if I didn't hate doing taxes before, yesterday solidifed my utter distain for taxes and everything they represent.

I (and possibly only I) firmly believe that taxes represent a failure in human efficiency. When you look at the average tax form its like all the little boxes and number are looking back at me and mocking me, saying,
"I know this looks easy, but we are going to make this incredibly hard for you...so hard we are going to devote an entire career field to just dealing with taxes (accountants) and they are mostly likely going to screw you over. Enjoy filling this out and pray you don't get audited, mwuahhhhhah!"

Stupid, evil taxes, why must you be so difficult to figure out? I tried to fill out my taxes on paper once and I became so frustrated with the process I went to H&R block two years later and made them file my back taxes for me.

Now, on to the important stuff:

So, Americans living abroad, did you realize that even though you are mostly filing taxes with the country you are living in, you ALSO have to file taxes in the U.S.? The U.S. is the only country that makes you file in both countries so don't go talking to your friends of other nationalities about this because they will have no idea what you are talking about....come to think about it most Americans living and working in the U.S don't even know what they are talking about.

But, after researching tirelessly and talking to H&R for over 4 hours on the phone (no joke) I think I have a coherent solution for Americans dealing with the issue of filing U.S taxes.

What you need to do as an American:

-DO IT BEFORE APRIL 15TH, THAT'S WHEN AMERICAN TAXES ARE DUE!

-Get your payment record form your employer (either a T-4 if you are in Canada)

-Obtain a 2555 EZ Form (Foreign Earned Income Exclusion form)

-The IRS currently provides free tax filing services so that you can do all of this online.
WARNING: Mail in the form, even though it says you can e-file it will most likely not work. So don't wait to the last minute to e-file (like I did), if you can't e-file save yourself the time and just mail the forms.

-You will not owe any money and you will most likely not get anything back, yet the U.S still wants you in their system...so obey!

-Click here for a link for a list of numbers for all your tax needs, however, I advice you not to call before the due date.

-Don't think you can fill out the form before the deadline? If you search for form 2350 online, that is extension form but you have to file it before the deadline (April 15th).

Hate life yet? Oh wait, there's more...

Here's a link for Americans who can get bigger and better refunds from the Obama's recent financial reform measures. If you didn't benefit from this tid bit of info this year hopefully you will be able to take advantage of it next year:
http://my.barackobama.com/page/content/taxsavings

I could go on and on and on about the hell of a process I went through but although I am happy to help y'all out there I'm getting more anxious as I type...so good luck and may the force be with you.

UPDATE: Many advocates have told me that Americans living abroad automatically have a one-month extrension to file whereas I previously mentioned that you had to apply for an extension. However, I have only read IN WRITING that you need to apply for the extension, so i'm just spouting the word of the book. Good luck to y'all.

2 comments:

Unknown said...

I was just a HR block and they told me (after I complained that their one Vancouver region staff who knows about US taxes refused to set an appointment with me for the 3rd week in a row) that I have till mid June to send my taxes in since I'm living abroad. I sure hope they didn't make that up. Did they not mention that to you?

I need to get two years done since I too tried to do it free online and it works up to a point - until you note you aren't earning income in the US. So frustrating. My taxes are so fricking basic. It irritates me to have to pay to file in the US too.

Oh and Democrats Abroad - worst ever - I've asked about tax advice from them and they have no clue. Mostly since most of them at the Vancouver branch are like friggin Canadian 100%. I was like why are you here? Oh you know... Obamas cute and I have a cousin there or I like worked there for a week once in the 70's. I know Americans don't want to be identified in Canada but seriously someone has to be out there who can assist with this stuff!

Anyways thanks for this post! Much appreciated.

Local Hero said...

I'm so sorry about your frustration.
Misery loves company though so hopefully we can make the most out of this silly situation