TurboTax or H&R Block-Expat to pay US taxes?

[ding]

TurboTax or H&R Block-Expat to pay US taxes? Or...?

 

cheers!

[skatewash]

I use Turbo Tax for everything but filing my taxes.  It's simply the best I've seen at importing tax forms from financial institutions (1099-INT, 1099-DIV, 1099-B, 1099-R).  It's the best tax software out there I'm aware of.  But I cling to the notion that filing taxes should be free so every year I first do my taxes on Turbo Tax to arrive at an Adjusted Gross Income figure and taxes due.  I then go to the IRS Free to File site:

https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free

to see which tax software I can use for free based on answers to the questions asked in the "Use Free Guided Tax Preparation."  This year my three free tax software recommendations were TaxAct, File Your Taxes, and Online Taxes.  I've looked at all three, but will probably go with TaxAct as I've filed with it before.  TurboTax used to participate in this program and I've used them before to file, but they dropped out of the program a few years ago.

I'm retired and aside from investor issues (dividends and stock sales) I have a relatively simple tax situation.  The free tax preparation software has always worked for me.  I have always used tax software to file my taxes, never used a service (which might be more appropriate for more complicated tax situations).

 

[poobear]

turbotax Never lets me file online a an expat.

[Xanthe]

Use free tax USA. No filing fees for Federal return. As an expat, you don't need any State tax filing also. 
https://www.freetaxusa.com/

Edited February 7, 2023 by Xanthe

[skatewash]

1 minute ago, poobear said:

turbotax Never lets me file online a an expat.

I have never experienced that problem.  I use my US mailing address (a Commercial Mail Receiving Agency) as my filing address.  Elsewhere when questioned by Turbo Tax I say that I am living in Thailand (this used to be significant to avoid Obamacare provisions, but don't think it's all that important anymore).  I also use a VPN pointed to the US whenever I am using Turbo Tax.

[skatewash]

18 minutes ago, Xanthe said:

Use free tax USA. No filing fees for Federal return. As an expat, you don't need any State tax filing also. 
https://www.freetaxusa.com/

Free Tax USA is a good one. 

I think whether you need to file a state income tax return depends on your individual circumstances.  If you tax residency is in a non state income tax state (Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming) then probably not.  If you have no income generation from your tax residency state then that's probably true as well, but I can imagine that there are circumstances in which an expat still needs to file a state income tax return even though they no longer live in the state (a good reason for making a non-state income tax state your tax residency).

Perhaps this might be helpful in exploring the issue of state income taxes:

https://www.ustaxhelp.com/determining-residency-for-tax-purposes-expat/#:~:text=If you are a United,have established your residency overseas.

Edited February 7, 2023 by skatewash

[NoDisplayName]

I've used this free service for years:

 

https://www.freefilefillableforms.com/home/default.php

 

Easy to use, has all the forms I need - 1040, schedules B and D, schedules 1 and 6, forms 8949 and 2555.  Accepts foreign addresses and foreign income without W2.

[ding]

5 minutes ago, NoDisplayName said:

Accepts foreign addresses and foreign income without W2.

Yes, as an aside:  I was just trying to fill out a FBAR Report 114 PDF on Firefox with VPN paused... and the drop downs didn't work. It required a "city" and "state" too. So, my Thai address won't work. 

 

Thanks for all the great suggestions folks!

 

I like TurboTax but read they don't support expat taxes. I do have a Registered Agent address but mail forwarding is expensive. My state has no income tax so it's possible.

 

H&R Block just started their expat-specific version but haven't heard any reviews.

[skatewash]

3 minutes ago, ding said:

Yes, as an aside:  I was just trying to fill out a FBAR Report 114 PDF on Firefox with VPN paused... and the drop downs didn't work. It required a "city" and "state" too. So, my Thai address won't work. 

 

Thanks for all the great suggestions folks!

 

I like TurboTax but read they don't support expat taxes. I do have a Registered Agent address but mail forwarding is expensive. My state has no income tax so it's possible.

 

H&R Block just started their expat-specific version but haven't heard any reviews.

I filed my FBAR pdf using Chrome, did not encounter the problems with the drop downs you mention.  I use my US Mailing Address as my address.  I use a VPN set to the US (as I do whenever doing anything US related, particularly financial).

It sounds like our tax situations may be substantially different (I'm retired) but all the tax software I've used does allow reporting of foreign taxes paid (Form 1116), albeit all mine are via US ETFs/mutual funds (Regulated Investment Companies - RICs).

I do have tax withheld on some Thai bank accounts for which I file a Thai Income Tax Return (PND-90) to have those refunded.  Therefore, I do not claim those taxes withheld on my US income tax return.

I'm retired so don't have to deal with other expat taxes relating to earned income, and am unfamiliar with those, which may be the ones you are referring to when saying the tax software doesn't handle it.

[NoDisplayName]

3 hours ago, ding said:

Yes, as an aside:  I was just trying to fill out a FBAR Report 114 PDF on Firefox with VPN paused... and the drop downs didn't work. It required a "city" and "state" too. So, my Thai address won't work. 

Instead of filling out the PDF, scroll down one option further, "File Online FBAR."

Dropdowns work - Firefox, no VPN.

[ding]

11 hours ago, skatewash said:

I'm retired so don't have to deal with other expat taxes relating to earned income, and am unfamiliar with those, which may be the ones you are referring to when saying the tax software doesn't handle it.

Thanks skatewash! This is my first year here, big thanks to all.

 

I'm retired too, just pensions, soc sec, and a rental house in the US for income - and tiny bank interest.

No work or investment income, no state income tax requirement.

 

I use a Registered Agent for my rental house. I use their address for double LLC privacy veil to prevent malicious lawsuits.

It may be possible to use that address for my taxes but it isn't my residence and mail-forwarding is expensive. 

 

I have 2 Bangkok Bank accounts and not sure what to do there yet.

 

I'll try the FBAR Online when I gather records. Chrome causes me some concern and don't use it yet. Maybe soon though.

[lopburi3]

Have had no issues doing FBAR online - do not use VPN or US address.  Do use Chrome.  No reason to use PDF as you can stop/start online and printout when done.

 

For tax Have successfully used both Taxact (about 10 years) and OLT (last two years) - use without VPN and use Thai address.  Tried TurboTax about 2 years ago (TaxAct required US phone or something - which they later corrected) and all good until pay and then they could not e-file (error message).  At which time tried OLT and exactly same refund and free.  Refund received Feb 2 last year and Feb 1 this year.

https://www.olt.com/main/home/default.asp

 

[JimGant]

14 hours ago, ding said:

Yes, as an aside:  I was just trying to fill out a FBAR Report 114 PDF on Firefox with VPN paused... and the drop downs didn't work. It required a "city" and "state" too. So, my Thai address won't work. 

Filling out the offline PDF won't work with Firefox -- you need Acrobat (the free Reader version works). When you check Thailand in the country drop down box, the state box greys out. Interestingly, older versions of Adobe Acrobat, like version 7, also fail to activate the drop down boxes.

[JimGant]

3 hours ago, lopburi3 said:

No reason to use PDF as you can stop/start online and printout when done.

Yeah, but a lot more efficient to dust off last year's FBAR PDF, unsign it, then fill in only that information that's changed. Of course, if everything has changed since last year's filing, I guess filing online wouldn't be any more onerous -- unless the power goes off.....

[lopburi3]

3 minutes ago, JimGant said:

Yeah, but a lot more efficient to dust off last year's FBAR PDF, unsign it, then fill in only that information that's changed. Of course, if everything has changed since last year's filing, I guess filing online wouldn't be any more onerous -- unless the power goes off.....

As said power of just continue when it returns.  Yes if you have many entries new each time could be a pain but for most of us with only one or two not that much.

[gamb00ler]

11 hours ago, lopburi3 said:

At which time tried OLT and exactly same refund and free.  Refund received Feb 2 last year and Feb 1 this year.

I agree... OLT accepts my Thai address, works well and is free for federal filing.  The user interface could be a little better.  After using for 2 years I can finish my return in an hour.  I have all income details ready by about the 2nd week of Jan. as I keep excellent records in a spreadsheet throughout the year.

[ding]

On 2/8/2023 at 8:36 PM, gamb00ler said:

I agree... OLT ...The user interface could be a little better...  

Does anyone know if OLT accepts Schedule E - rental house income?

 

I don't mind some busy work, but hate dead-ends!

Edited February 11, 2023 by ding

[lopburi3]

Do not use that but web site says they accept all forms.

9 minutes ago, ding said:

Does anyone know if OLT accepts Schedule E - rental house income?

 

I don't mind some busy work, but hate dead-ends!

 

[mudcat]

Ah, tax season - comes after the holiday season to wipe away that smile.  My wife is a U.S. citizen and, as a Thai, is surprised at the U.S. government's intrusiveness.

 

As my wife plans to move all her financial assets to Thailand when she inherits if I pre-decease her, we have been working together for her to file her FinCEN114 (FBAR) report.  She will not need to file taxes as her interest earnings will be below her standard deduction even after beginning Social Security.  As there is no tax filing she is also exempts from filing f8938 even though her Thai assets would otherwise require it. 

 

To prepare and file her FinCEN114 she updates her Thai bank books and identifies her interest earnings and high balance in each account.  She enters each payment and balance into a spreadsheet using the appropriate December 31st exchange rate from the U.S Treasury (below) to convert her total baht interest and high balance to U.S. dollars (rounding her interest total and rounding up her high balances). 

 

She then opens a a template FinCEN114.pdf that has each bank account with their address already entered.  She enters a new filing name for the year e.g. XXXX2022 on page 1 and enters the tax year on page 3.  She then transfers the high dollar balances for each account.  She saves the file as FBAR XXXX2022.pdf, moves to the home page and completes the filing information (name, email, and phone).  She saves all the spreadsheet and pdf into a single folder along with all emails from [email protected]

 

After receiving my LTR-P visa last year I no longer maintain enough of a Thai bank account to need to file FBARs any longer and took the ThB830K and bought us a new car.

As I am a >20-years older and my finances in the U.S. have a number of moving pieces we are using a tax service (MyExpatTaxes) because they will hold my wife's hand to complete our married filing jointly if I am unable to help.  I have stressed the importance of staying compliant for the day when she can file for spouse or survivor Social Security benefits.

 

Get the correct exchange rate for FBAR (and we use if for Schedule B as well)

https://fiscaldata.treasury.gov/datasets/treasury-reporting-rates-exchange/treasury-reporting-rates-of-exchange

Edited February 11, 2023 by mudcat
formatting

[gamb00ler]

2 hours ago, ding said:

Does anyone know if OLT accepts Schedule E - rental house income?

 

I don't mind some busy work, but hate dead-ends!

I went to OLT and started an amendment to my 2022 return to see if I can add rental income.  OLT does show it supports Sch. E

[skatewash]

3 hours ago, ding said:

Does anyone know if OLT accepts Schedule E - rental house income?

 

I don't mind some busy work, but hate dead-ends!

Yes, it does...

[mudcat]

Another form needed for income rental property is f4562 where you list your depreciation - for TurboTax that always sent us off into a more expensive category of software - the one advantage was TurboTax did the calculations and remainder of depreciation available.

[TallGuyJohninBKK]

On 2/7/2023 at 8:32 PM, skatewash said:

I can imagine that there are circumstances in which an expat still needs to file a state income tax return even though they no longer live in the state (a good reason for making a non-state income tax state your tax residency).

Such as, if you're living abroad like in Thailand, but are earning income from rental property back in the U.S. from a state with state income tax.

 

Merely being expat living abroad by no means gives anyone an all-purpose pass on state tax liability.