The IRS

[Alexei]

Howdy folks,

My first post on here. Woo!

So I've been reading posts from all sorts of folks on here, of the "I've been cruising for x years" variety, and a thought occured to me.

Whether or not you've earned a bunch of income, you still have to file a tax return, no? And if you've earned income outside the US, you owe taxes on it (if it's over the limit....$75,000 I think was the cutoff last time I looked). There's big trouble if you fail to file and/or account for that foreign income (assuming the income wasn't under the table).

So now your tooling around somewhere, minding your own business and enjoying the sun, and April 15th rolls around. I guess it's easy if you've got internet acces and Turbotax, but not every place has that. And good luck finding a 1040 in Tiny-island South Paciifc.

How do/did all you cruising types handle that?

Just curious for later on down the road.


-Alexei

[Sailabel]

Hi- we just used turbo-tax. Can download the program and it includes all the forms. I believe they have the option to do taxes on a site, so the program isn't needed. Then e-file with direct deposit. We're only in Mexico, but we found the process quite easy.... as long as we had internet access.

Steve

[JiffyLube]

If you provide the information needed to complete your taxes, a tax preparer or someone acting on you behalf as the tax preparer, can file the taxes for you.

[Therapy]

Originally Posted by Alexei

(if it's over the limit....$75,000 I think was the cutoff last time I looked).


-Alexei

I don't think that will be a problem for me!

[Sunspot Baby]

Asking this group for tax advice is like asking a guy in a bar which stocks to buy. Sorry, we know a lot about a few things, but get a professional.

George

[waterworldly]

Go to irs.gov. Click on the approved vendors link. One is HR Block. Just like Turbo tax but no program to download. Do taxes by answering questionaire. Have refund sent directly to checking or savings account OR deduct payment directly from checking or savings. No hassle. Costs 29.00. Have used it for years, even on complicated return wth capital gains, interest income, medical expenses etc. Everything is automatic. No paper forms. Everything is filed electronically. They also maintain a copy of your return online at their server (for years) At end of questionaire, you can download finished return as PDF. Flawless.

[maxingout]

I lived outside the USA for twenty-eight years, and I always took the automatic extension of the filing date until June 15. When you are outside the USA on the filing date, you can take the extension without a problem. Of course, you have to be sure that you have made enough estimated tax payments to cover your tax liability by April 15, or there will be penalities that apply.

You can easily download any tax forms that you want off the internet almost any place in the world. An easy way to do it is to take a USB memory stick to an internet cafe, download the tax forms onto the stick, and then take the memory stick back to your boat where you can upload the forms on your computer and print them out.

[Alan Wheeler]

Outside of your own country, it probably won't be an issue as you can't work with out a permit anyway. And to get a work permit is not easy in most cases. There will be the odd few exceptions, but mostly the above will be the norm. Besides, if you worked in another country, you pay tax for that country. You won't or shouldn't pay tax again in your own.

[seafox]

Alan,
he still would have to file a tax return for his investments. Also lots of Countries do not have double taxation agreements between them. If that is the case yes he would have to pay tax twice.
It is the same for us. If you go to the ird website you can see who we have double taxation agreements with.

[GordMay]

US Tax Treaty Information:

Tax Treaties

Publication 901 (4/2008), U.S. Tax Treaties

Publication 54 (2007), Tax Guide for U.S. Citizens and Resident Aliens Abroad

[Hud3]

I second Dave's advice, above. You have to file a federal return, and possibly a state return. You'll need your 1099s and 1098s, etc., so you'll need a mail forwarding service, friend or relative to send them to you. That almost certainly means you'll need to apply for an extension.

Living in the Caribbean, I do my own taxes using Turbotax online, but needed the extension to make it work.

[kibby f5]

You can get Publication 54 automatically snail mailed to you, (forms included) but you'll need a good forwarding arrangement.

To qualify for Foreign Earned Income you'll need to pass a "presence" or a "bonified residence" test. Both are on the Form 2555. You'll have the base exemption plus individual exemptions to bring down the taxable amount. OR, if you paid taxes to a foreign country (form 1116) you can deduct those from what you would have owed the US. BUT, you can't do both.

US Investment income is different.