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Important Tax Reminder

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  • escazicr5633
    Remember that if you owe taxes to the IRS you have until April 15th to file an extension, Form 2350, but you must pay any taxes owed at that time to avoid
    Message 1 of 11 , Apr 5, 2014
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      Remember that if you owe taxes to the IRS you have until April 15th to file an extension, Form 2350, but you must pay any taxes owed at that time to avoid incurring interest or penalty.
      If you owe no taxes, as a resident of a foreign country you have until June 15th to file the return without an extension. Keep in mind that if you were in the U.S. more than 30 days during the year, the automatic extension to June 15th will not apply nor will the $97,600 Foreign Earned Income Exclusion on tax.
      If you need help with your returns, contact me: Marlene B. Summers, Tax Preparation, at marlene.summers@.... You will receive a prompt response.

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    • Peter Wendell
      With respect to the tax filing requirements and deadlines of US citizens living abroad, this is a quote from the IRS website: When to File If you are a U.S.
      Message 2 of 11 , Apr 5, 2014
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        With respect to the tax filing requirements and deadlines of US citizens living abroad, this is a quote from the IRS website:

        When to File
        If you are a U.S. citizen or resident alien residing overseas, or are in the military on duty outside the U.S., on the regular due date of your return, you are allowed an automatic 2-month extension to file your return and pay any amount due without requesting an extension. For a calendar year return, the automatic 2-month extension is to June 15

        Would the person who is posting tax information that appears to contradict this � they have written that taxes must be paid before April 15th and that anyone who was in the US for more than 30 days during the tax year does not qualify for the automatic extension � please provide documentation for what they are saying. It may be confusing to some if it is mistaken.




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      • escazicr5633
        If you are a U.S. expat living abroad and owe taxes, you need to file an extension by April 15th and pay any amount owed with the extension. If you do not
        Message 3 of 11 , Apr 5, 2014
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          If you are a U.S. expat living abroad and owe taxes, you need to file an extension by April 15th and pay any amount owed with the extension. If you do not owe taxes, you do have an automatic extension to June 15th to file your return.
          If you lived in the U.S. 30 days or more during the year, you lose your expat status and must file your return by April 15th, or an extension, whether or not you owe taxes.
          In other words, you are not eligible for the automatic extension if you owe no taxes nor are you eligible for the $97,600 Exclusion for Foreign Earned Income. (Earned income meaning from salaries or self-employment.......not investment income.)
          Does that make it more clear? If not, please visit the IRS site at irs.gov.
          Malene Summers at marlene.summers@...

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        • Peter Wendell
          ... I donÆt want to belabor this, but I did check the IRS site before sending my first reply, which I quoted. The statement that a US citizen residing abroad
          Message 4 of 11 , Apr 6, 2014
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            > Does that make it more clear? If not, please visit the IRS site at irs.gov.

            I don�t want to belabor this, but I did check the IRS site before sending my first reply, which I quoted. The statement that a US citizen residing abroad is not entitled to the automatic 2 month extension if he/she owes taxes seems to contradict what I have read and what I quoted from the IRS in my reply. Here is the URL: http://www.irs.gov/Individuals/International-Taxpayers/U.S.-Citizens-and-Resident-Aliens-Abroad

            This link, along with the link it contains that explains the automatic 2 month extension, appears to me to clearly state that any US citizen residing abroad on the date taxes would normally be due is entitled to the automatic 2 month extension for both filing and paying taxes. If I am incorrect in my interpretation, I would really appreciate someone directing me to the relevant regulations. Thank you.




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          • escazicr5633
            I do see your point from what is quoted on the IRS website. It does seem to contradict what I wrote. However, it is and has always been my understanding the
            Message 5 of 11 , Apr 6, 2014
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              I do see your point from what is quoted on the IRS website. It does seem to contradict what I wrote. However, it is and has always been my understanding the automatic two month extension is to file the return but not to pay anything owed. If you do not pay the amount owed by April 15th, interest/penalty is owed on the unpaid amount.
              Here is a quote from Greenback Expat Tax Services as another resource. They have been in business for some time. Please read it carefully.
              http://www.expatnetwork.com/Money/Expat-Tax/FAQs-for-American-Expats.cfm http://www.expatnetwork.com/Money/Expat-Tax/FAQs-for-American-Expats.cfm
              When are my US expat taxes due?
              For most Americans, the deadline is April 15th, but for U.S. citizens living abroad or resident aliens (e.g. Green Card holders) an automatic extension is given to June 15th. If you need additional time, you can file for an extension until October 15th.
              Please note: if you owe any taxes, then you will owe interest on this amount from April 15th to the date you pay the taxes. Therefore, it is in your best interest to file your US expat taxes as soon as you are able. Also there is no extension for the FBAR (Form 90-22-1) which must be received by the US treasury by June 30th each year you are required to file it.


              How do I file for an extension on my US expat taxes?
              If an individual is a little pressed for time, he or she can file an extension by completing form 4868 and sending that in to the IRS. There is usually no fee for filing form 4868 and you can even e-file it for convenience.
              However, even though you can get an extension on when you file your returns, there is no extension for paying the IRS. If you owe money in taxes you are still required to pay by April 15th of a given tax year or face interest and penalties. It is up to you (or your tax professional) to estimate your total tax owed. Once you have estimated your tax owed, you can mail (or send electronically) your payment in along with your 4868.

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            • escazicr5633
              Peter, I do agree the IRS instructions are confusing. If you will go to irs.gov and read the instructions on Form 4868 (the extension to file) it does say, in
              Message 6 of 11 , Apr 6, 2014
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                Peter, I do agree the IRS instructions are confusing. If you will go to irs.gov and read the instructions on Form 4868 (the extension to file) it does say, in the first column at the bottom of the page, that you will owe interest on any tax not paid by the regular due date. (Meaning April 15th.) Even if you do qualify for the 2-month extension because you lived out of the country.
                Again, as confusing as the wording can be, other preparers advise that whatever tax is not paid by April 15th, regardless of any extension filed or believed to be automatic, this tax will earn interest and possible penalties. It gets down to this: The IRS wants its money when due.

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              • John French
                I guess i must chime in. As an ex-pat living in CR I have been paying my tax on June 15th for years, and the IRS has yet to complain. So my experience supports
                Message 7 of 11 , Apr 6, 2014
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                  I guess i must chime in. As an ex-pat living in CR I have been paying my
                  tax on June 15th for years, and the IRS has yet to complain. So my
                  experience supports Peter Wendell's interpretation of what i agree is
                  very simple language from the IRS:
                  "you are allowed an automatic 2-month extension to file your return and
                  pay any amount due without requesting an extension."

                  More than that, the IRS tell goes on to tell us that ex-pats can get an
                  extra extension until October 15th, but must file for the extension and
                  MUST PAY the tax by June 15th.

                  And to top it off, I sometimes actually have mailed the form AND payment
                  exactly on June 15th. No problem. But i do send it return receipt requested.

                  John French
                • escazicr5633
                  This is a quote from IRS Pub 54, Tax Guide for U.S. Citizens and Aliens Abroad. 1) When are U.S. income tax returns due? Generally, for calendar year
                  Message 8 of 11 , Apr 7, 2014
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                    This is a quote from IRS Pub 54, Tax Guide for U.S. Citizens and Aliens Abroad.
                    1) When are U.S. income tax returns due? Generally, for calendar year taxpayers, U.S. income tax returns are due on April 15. If you are a U.S. citizen or resident and both your tax home and your abode are outside the United States and Puerto Rico on the regular due date, an automatic extension is granted to June 15 for filing the return. Interest will be charged on any tax due, as shown on the return, from April 15.

                    http://taxmap.ntis.gov/taxmap/pubs/p54-027.htm#TXMP472cb695 http://taxmap.ntis.gov/taxmap/pubs/p54-027.htm#TXMP472cb695

                    If anyone owed tax and didn't pay it until June 15th and weren't later charged interest, it must have been an anomaly. Perhaps the interest due was small and not worth persuing.

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                  • Peter Wendell
                    Thanks a lot for the clarification, Marlene. That supports what I found after digging around on the IRS site. [Non-text portions of this message have been
                    Message 9 of 11 , Apr 7, 2014
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                      Thanks a lot for the clarification, Marlene. That supports what I found after digging around on the IRS site.

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                    • alajuelanorth
                      John s right as usual :-)) We do about the same, Berni [Non-text portions of this message have been removed]
                      Message 10 of 11 , Apr 7, 2014
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                        John's right as usual :-))
                        We do about the same, Berni

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                      • John French
                        The IRS is very clear on when the deadline to pay taxes is for ex-pats. They are very clear in two places -- Publication 54, and their page U.S. Citizens and
                        Message 11 of 11 , Apr 8, 2014
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                          The IRS is very clear on when the deadline to pay taxes is for ex-pats.
                          They are very clear in two places -- Publication 54, and their page
                          "U.S. Citizens and Resident Aliens Abroad"

                          Only problem is -- the two documents say very different things, very
                          clearly. Any good lawyer would tell me to choose the one that favors me.
                          I have done that, and so far it is working. It might well be that every
                          year some tax worker hits the button that says, "Give French a break, it
                          ain't that much money."

                          Or it might be that they are aware that they are inconsistent, and don't
                          want to fight that fight.

                          The IRS also has a bundle of rules that end up requiring that i pay
                          "withholding" on, as i remember it, at least 90% of my U.S. earnings. So
                          they already have my money anyway, or at least the biggest part thereof.

                          John French
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