First Step: Contacting the IRS About My Expat Taxes Status

By: Pete
Date posted: 10.20.2011 (11:30 pm) | Write a Comment  (1 Comment)

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I think it’s very much in my advantage to be in regular contact with the IRS regarding taxes to be paid as an expat and even the fact that I have never reported income in past years. I sent an email to the IRS address after finding some information on their website regarding my obligations as a US citizen living abroad and how I would be able to get myself back in compliance. I obviously did not know what to expect but I tend to think thar it is much better to be as straightforward as I can possibly. I do not expect this process to be easy or take a few days or else I would not have received an estimate of over $20,000

I will not be posting any emails directly here simply because I’m not sure if that would create any issues. Instead I will simply give a few parts of what I was told:

Assuming you did not formally renounce your U.S. citizenship, you will be required to file a return according to the Requirements to file each year based on your world wide income

No surprise there of course, it is consistent with everything else that I have read in the past few years. I was told that under Policy Statement P-5 133, the IRS would accept filings for the past 6 years (I had asked how far back I needed to go). I don’t see this as a huge issue given the fact that once I get things right for one year, I would expect other years to be fairly similar. I am also happy to not be forced to declare my entire lifetime of income (at least for now!).

In order to determine exactly which file I must use, I was told to consult the Requirements to File tables located in Chapter 1 (Filing Information) of Publication 54 (Tax Guide for U.S. Citizens and Resident Aliens Abroad).

I was also told there would be penalties if I did owe money to the IRS (not a surprise but I do not expect to owe anything as a Canadian taxes payer). I was also given a lot of information regarding conditions under which I would get exemptions from reporting, under which I would have (or not) to pay income taxes, etc. All of this turned into a 2-3 page email from the IRS that I could probably read a dozen times while still missing quite a few elements. I was very happy to get such a good summary from the IRS but to say that I’m now out of the woods would be a major overstatement. I feel like I’m on my second step of climbing Mt Kilimanjaro:)

Over the next few posts, I will be going over my process, what exaclty I end up having to do in order to get myself fully compliant. I do not expect this process to be over in 2-3 months, it might take a while longer. I am 100% confident though that I will be able to get everything in order to become a 100% compliant US citizen:) That is the main goal and a close second would be not losing all of my free time trying to get that done:) I would love to hear from you if you are in the same process!

I do invite you to sign up for our free newsletter below in order to get more detailed information about this process.

1 Comment »

  1. Comment by Peter — March 13, 2012 @ 8:27 pm

    i would like to sign up for the free news letter

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