Expat Tax Services

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Ray CPA provides international accounting and US tax services to U.S. and foreign expatriates residing throughout the world.  We have focused heavily on developing our international tax business in Asia. The staff at Ray CPA speak a variety of Asian languages, including Mandarin Chinese, Taiwanese, and Vietnamese, and have associates based in China. We are familiar with Chinese tax reporting and the IIT. If you're planning a move abroad, or you're already an expatriate, whether a US ex-pat living abroad, or non-US citizen residing or investing in the US, you have more to think about than adjusting to a new culture. Although it may be tempting, you must not ignore your U.S. and foreign taxes!

We also have practical, real-world experience with Foreign Earned Income Exclusion (FEIE), Foreign Tax Credits, Hypothetical US Tax (Hypo-Tax) programs, and the knowledge necessary to optimize US ex-pats' tax situation when stationed overseas on extended foreign assignments.

Every U.S. citizen, U.S. resident and U.S. green-card holder - regardless of whether they are living in the U.S. - must file a tax return with the federal government.   And every U.S. citizen and U.S. resident must report their worldwide income on their U.S. tax returns.

The tax situation for expatriates is often complicated and frustrating. Many variables affect how much expatriates pay in taxes, such as: 1) whether you have foreign taxes deducted from your pay, 2) tax laws in your your host country, and 3) details of your employment situation.

Fortunately, we can help.

U.S. Taxes for Expatriates - Pitfalls and Traps

To ensure a smooth tax-filing process, you must be well informed. If you take up residence in a foreign country without exploring the tax ramifications, you may find yourself paying more than you expect to the U.S. government, your home state and/or your host country - as well as penalties and interest.

Some of the important considerations include…

  • Amount of foreign earned income. You can deduct a substantial amount in earned foreign income from your U.S. taxes.
  • Your host country. Many countries have tax treaties or conventions with the United States, which will dictate how you file your U.S. taxes.
  • Which state you most recently lived in. Some states do not have income taxes; others make it difficult to sever your ties with that state.
  • Rental income and dividends/interest from assets in the U.S. You must pay taxes on these exactly as if you were living in the U.S.
  • Whether you are self-employed. You must pay self-employment tax on your income, even if you can exclude it as foreign earned income on your income taxes.
  • Your holdings in a foreign bank account. Any interest in or authority over a foreign financial account over a certain amount must be reported to the U.S. Treasury Department.

Our Expat Tax Services

Although the IRS offers numerous deductions, credits, and exclusions to expats, taking advantage of them is not straightforward.

Some exclusions vary by country, while others can only be claimed for a portion of the year. In addition, each requires supporting forms and worksheets, which can be more than cumbersome to prepare.

For people who are either planning a move or have already settled abroad, we offer the following tax services:

  • U.S. Tax Returns - We prepare your U.S. income tax return, including the most common schedules and forms.

  • State Tax Returns - Depending on which state you most recently lived in, you may need to file a state return.

  • Small Business Tax Returns - We assist small business owners, self-employed individuals, or folks with significant rental property with their returns.

  • Online Filing - When you're living in a foreign country, it's not practical to send forms and documents back and forth through the mail. Our highly secure, fully encrypted Client Portal enables the quick, free, and safe transfer of files between our office and yours.

  • Foreign Bank Account Reporting - We file the FBAR form for individuals who had above a certain threshold in a foreign account.

  • Compliance - It's not uncommon for expats to fall behind on their taxes. We help you sort through the paperwork, forms, and rules, and get you back in compliance with the IRS.

  • Hypothetical Tax - Working in conjunction with your employer, a hypo-tax program is designed to keep you whole to your U.S. taxation level, being taxed as if you were earning your base pay in the U.S.     

  • Consulting - If you're unsure of your need to file federal or state tax returns, give us a call. We help you get clear on your situation.

We also have experience reporting for controlled foreign corporations and partnerships, international mergers and acquisitions, reporting under International Financial Reporting Standards, transferring property to a foreign corporation, currency translations, the Expatriation Tax Provision, and foreign trust reporting. 

Contact Our Office Today

There's no need for expats to pay more than required - or suffer under penalties and interest - just because the process is more confusing for them.

Let us help you navigate the tricky waters of U.S. taxes for expats. Give us a call or send us an email today - and use more of your money to enjoy your life abroad!