[Nononymous]

This is Tabitha with Greenback Expat Tax Services... Tax time is in full swing and we want to help!

Actually it isn't tax time anymore.

My advice to anyone outside the US who's compliant and considering writing the US government a check: think twice, you may need that money.

 

[Nononymous]

The purpose of this thread is to answer more general questions that help a broad spectrum of individuals. Digging into individual tax code is something that you will want to discuss directly with a tax attorney. On the Greenback team we have just US licensed A's and EA's and not tax attorneys.

For the benefit of those who are still compliant, please outline the new deadlines now that filing has been pushed back due to the emergency.

I would also be interested to hear any reports of weakened FATCA enforcement in Europe (banks discriminating against US person customers) due to the crisis and the fact that there are no renunciation appointments now that US consulates are closed.

Again, I would advise anyone who is compliant and owes a tax bill to think long and hard about whether they can now afford to send their annual contribution to the IRS. For those not at risk of punishment (no US assets or income, a second port) this may be the year to finally break that peculiar habit.

 

[Nononymous]

Boy, this thread sure went quiet. Whatever happened to "ask me anything"?

 

[Nononymous]

Thank you.

Any anecdotal reports of banks being less strict about FATCA requirements, now that the IRS is likely to be a smoking crater for quite some time to come?

 

[Nononymous]

We have heard nothing of the sort so far. We are still seeing our clients receive FATCA rules/regulations and the request for W9 forms when creating foreign bank s.

Too bad, for those who are unable to conceal US citizenship or birthplace. Perhaps that will happen if the crisis deepens and renunciations become impossible.

 

[Nononymous]

Two questions:

I just saw something on the CNN site suggesting that the $1200 “stimulus check” would go to anyone with Adjusted Gross Income below $75,000 on their 2018 or 2019 tax return. Isn’t the AGI the number you get *after* taking the FEIE? This would make it a nice little bonus for many well-paid non-residents.

Also, can you file a US tax return with a PO Box or a mail-forwarding service, instead of a street address?

 

[Nononymous]

Please do keep us posted as the details of this program emerge. Seems like an easy way to score half the renunciation fee!

 

[Nononymous]

Hi All,

Here is an on-demand copy of the webinar if anyone would like to have a listen. It goes over questions related to the stimulus checks as well as many others (over 70 questions were answered during our live Q&A).

https://www.greenbacktaxservices.com/tax-webinars/coronavirus-tax-changes/

Nononymous, right now the details are still up in the air as to how exactly they will consider those who take the FEIE. As they release firm guidance we will keep everyone updated. It is supposed to be based on AGI, so in that event those taking the FEIE could still have the option to receive it if earning over 75k.

When it comes to the mailing address, the IRS will send to most mail forwarding services but they will only send to a PO box if mail is unable to be delivered to your home address.

Fabulous. Thanks. Suddenly a 50 percent discount on renunciations, without having to cough up your real address!

 

[Nononymous]

Well you will need to have filed tax returns in order to be eligible for the stimulus. At a minimum 2018 or 2019 will need to be on file.

Yes, understood. A simple 1040 with an income level under the FEIE should do the job. No need to use one's real address either, with a mail forwarding service.

 

[Nononymous]

In media coverage of the stimulus plan I have seen reports of "a so-called simple tax return the IRS plans to release in the coming weeks." This is apparently necessary due to the large numbers of non-filers in the US who would otherwise not receive their checks. If you learn any more about this simplified form, and whether it would apply to non-residents, please let us know.

 

[Nononymous]

Yeah, it's all still pretty fluid. By virtue of being a dual in Canada I'm currently a big fan of non-compliance and not renouncing, because the situation is so easy: the IRS never bothers anyone and FATCA is easily avoided by not disclosing US birthplace or citizenship when opening bank s. But suddenly this crisis may present the opportunity to obtain a free or heavily discounted CLN courtesy of the US government. File a 2019 tax return, wait for the check or checks to arrive, then renounce.

 

[Nononymous]

Could you confirm that the key number for eligibility is AGI, not income? So actually a non-resident earning up to $180,000 while claiming the FEIE would be entitled to the full amount.

 

[Nononymous]

Yes, the Treasury is supposed to be developing an online portal for people to update their direct deposit details. I anticipate that program will only allow US bank s to be entered, but we will see once it is live.

It's now super easy to obtain a US routing and number with Transferwise.

 

[Nononymous]

Since the money you make selling the home is capital gains not income, earned or otherwise, you can't use the FEIE to exclude the amount over $250k. And since you'll pay no UK tax on the gain you can't use the FTC route either.

It's a hard tax to avoid - just ask Boris Johnson. It is however easy to evade, if you don't report the sale. If you have UK citizenship by now and your assets are all in the UK, you are free to ignore the IRS.

 

[Nononymous]

I know nothing about the mechanics of paying or not paying CGT so can't advise on income limits etc.

Do you really think that changing your address is going to raise a flag? It's not like someone at IRS world HQ is going to suddenly think "Oh, a person in another country has moved. They must have sold their house and failed to report gains in excess of $250,000." The only way they would figure that out is if you told them.

 

[Nononymous]

So therefore wouldn't it be plausible that the IRS could read the detail on the payments that are made to my , and think (based on the detail on the payments) that they are independent contractor payments?

It's already been answered above in more detail, but I'll reiterate. For any s reported under FATCA, the IRS will only see your year-end balance and any interest/dividend income. Banks are not required to report s with balances under US$50,000, but they are not prevented from doing so. In some countries certain types, typically tax-protected savings schemes, are not required to be reported. You should look at the text of the US - Costa Rica Intergovernmental Agreement to see exactly what is and is not reportable.

If the IRS decided that you were worth a serious investigation, it could request assistance from the Costa Rican government (I'm assuming this - check the tax treaty for details). But there would not be any automatic bulk transfer of information beyond what's included in the FATCA agreement.