International Nesties
Dear Community,
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
US tax question
So we were told by the man who does our taxes in the US, that my DH could only enter the US for 35 days out of the year (so we don't pay income tax in the US). He is the only one who earns money, so it applies to him and not to me. We are quickly coming up on the beginning of year 2 of living abroad, so I wanted to see if any of you know how the taxes work. Is it still 35 days a year after you have established residency abroad? Or is it different for the 2nd year?
My BIL is getting married the end of November, and it would be fun to go back for the wedding, Thanksgiving, and maybe an early Christmas before returning to England. We need to find out if this is possible for DH to do, or if we need to ration his days in the US. Anyone know?
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Re: US tax question
I am about 90% certain that the 35 day rule only applies the first year you live overseas. But why not ask your tax guy to be certain?
I think if you google "IRS foreign earned income exclusion" you should get good info. I'd send a link, but my internet is too slow and the site didn't load.
You can exempt your foreign earned income up to the maximum (around $90K/individual) if you meet 1 of 2 criteria: (1) pass the physical presence test, that is, you were not physically present in the US for more than 35 days (this is where your accountant is getting this; OR (2) pass the bona fide resident test, that is, you are a bona fide resident of a foreign state and this is where you are paying taxes.
You only have to pass one of the two tests.
If you read the link I sent above then you'll see that once you've been a foreign resident for one full tax year, you are good.
First ooolala is right that you only have to pass one test - physical presence or bona fide residence. So the 35 day rule does not apply to you because you're a bona fide resident in another country.
What most people don't know (because really why would you if you're not a CPA?) is that you don't have to wait a year to qualify for bona fide resident status. The bona fide resident rule is one calendar year, but what if you move in July? Because the IRS is aware that not every one moves in January, they will allow you to extend your tax return if you expect to qualify for bona fide residence. For example, if you moved July 2011 you will not meet the bona fide resident test until January 2013 (one full tax year Jan - Dec). However you are a bona fide resident the day you move in July 2011. In this case you would extend filing your 2011 taxes until January 2013. Form 2350 is the one you would use to do this.
Thank you for this...we will be in this situation, and I had no idea that we could do an extension for that amount of time.