Side Of Effects Of Obama Foreign Business Tax Crackdown

[Naam]

clients who are subjects of the IRS.

I love that !!

nowhere in any jurisdiction of the civilised world has a taxman the paramount powers which the IRS has and is able to apply without a judge respectively a court decision involved.

[CWMcMurray]

4. If I am married and my wife has an acount in her name (its her business account) and this is over 10,000 am I obligated to register it?

5. If not, what if its her name on the account, but I am also listed an authorized user (can deposit or withdraw funds).

Is your wife American or Thai, and if American do you file a joint return?

My wife is Thai and I just recently finished University here in Thailand. Next year will be my first year filing a return. So I am starting to investigate about all of the tax issues now, so I do not have to scramble next April.

Would like to file separately (i.e. me and the kids on mine and my wife not file).

-----------------------------------------------------

Not sure if I need to file for a Tax ID number for my wife. I have 1 daughter and another in the way. So was not sure if it would be better to file just for me and 2 kids next year and leave my wife out or get her a Tax ID and put all three on my taxes.

I would guess that I should not put my wife on or if I do, then I would need to add her income and then her Business accounts would also be needed???? If so, is this amount still covered under foreign earned income??? Do I need a separate form for her???

Not sure, but if I file separately, does that mean none of her income would come into account? Because if we file separately, she does not have a greencard, not working in US, so no need to file???

[Tokay]

4. If I am married and my wife has an acount in her name (its her business account) and this is over 10,000 am I obligated to register it?

5. If not, what if its her name on the account, but I am also listed an authorized user (can deposit or withdraw funds).

Is your wife American or Thai, and if American do you file a joint return?

My wife is Thai and I just recently finished University here in Thailand. Next year will be my first year filing a return. So I am starting to investigate about all of the tax issues now, so I do not have to scramble next April.

Would like to file separately (i.e. me and the kids on mine and my wife not file).

-----------------------------------------------------

Not sure if I need to file for a Tax ID number for my wife. I have 1 daughter and another in the way. So was not sure if it would be better to file just for me and 2 kids next year and leave my wife out or get her a Tax ID and put all three on my taxes.

I would guess that I should not put my wife on or if I do, then I would need to add her income and then her Business accounts would also be needed???? If so, is this amount still covered under foreign earned income??? Do I need a separate form for her???

Not sure, but if I file separately, does that mean none of her income would come into account? Because if we file separately, she does not have a greencard, not working in US, so no need to file???

If your wife is not a US citizen, then she does not have to report anything to the US government. Nor do you have to claim her income on your taxes. Her money is her money. Though I do suggest NOT having a joint account because if the IRS wants to be a dick, you won't have any real way to prove what money is hers and what is yours without keeping detailed records, which you can bypass just by getting separate accounts. The IRS could also claim that you are the beneficiary of this account and are in control of the money, thus making you responsible for all of it.

Have an account for you. Have an account for her. Don't mix the two. It will just make things more difficult for you. And yes, if YOUR money is more than 10k total, you are supposed to claim it. If it's a mix of yours and hers, unless you can prove on paper how her money got into your account (and even then?), you may be responsible for it. The IRS wants our money.

I do advise learning about the foreign earned income exclusion. If you qualify or can put yourself in a position to qualify, the IRS will grant you (2009) a $91,400 tax break plus you can still have expenses. There is too much to type but in a nut shell, you still have to file every year but if you can set yourself up right, and play by the rules the IRS sets for you, you won't pay much in US taxes ever again. Of course it opens a can of worms for the Thailand side, but they have a tax treaty with the US so it all works out.

With all of that said, I'm not an accountant and you should seek the advice of one (a US one that deals with expats).

And yes, taxes and the IRS sucks.

[IMA_FARANG]

Well I just watched his speech and don't have a text link for this yet, but the gist of it that Obama is going to request that all foreign banks issue USA IRS 1099's to US nationals having accounts with them, and if they don't, the IRS will just assume the worse about the US taxpayers and tax accordingly.

The US government has to get the money somewhere and we are as good a target as anybody. Just a heads up, if you getting any income from Thai bank accounts, even piddly interest, you had best REPORT it. And don't forget your treasury forms due June 30. They are now asking for more specific info on the dollar amounts in these accounts. I smell some hassles coming for many of us, innocent or not ...

While most of us are small potatoes compared to the big corps like Coke which are the fat targets, they are hiring a bunch of new agents to focus on foreign issues, so we might be collateral damage. Enjoy ...

The president will also direct the Internal Revenue Service to more closely scrutinize the tax returns of individuals with offshore accounts and investments, which are often used to avoid paying U.S. taxes

You're right...it could be a potential problem for U.S. expats in Thailand.

Consider this possiblity:

An American expat either working in or out of Thailand, and supporting a Thai family in Thailand.

This expat opens a bank account in Thailand so he/she can transfer money every month to his/her family in Thailand.

Let's assume the amount transferred is about $1500 a month, which is used by the Thai family for living expenses.

If the Thai bank account is in the name of the expat, he/she has to inform the IRS of the bank account as long as the account amount is over $10,000. Since the amount transferred monthly is $1500, the annual amount transferred is over the $10,000 limit. The IRS will assume that it is being transferred into the Thai bank account as a savings account for the expat. They will be able to trace the transfers if they can get access to the U.S. bank transfer records (especially if it is a swift or wire transfer from the U.S. bank to the Thai bank).

The IRS is likely to assume the money is being sent overseas to the Thai bank account as a savings account to avoid paying tax on the money.

It will be up to the expat to prove that he/she is using the money to support the Thai family. That requires the Thai bank records showing a monthly transfer and corresponding withdrawals from the the Thai bank (either by a cash withdrawal or an ATM withdrawal).

I can see potential trouble with the IRS over this.

P.S. There used to be a bar on Patpong that sold a T-shirt that said,

"Fight Organized Crime.....Abolish the IRS".

Edited May 6, 2009 by IMA_FARANG

[flying]

Let's assume the amount transferred is about $1500 a month, which is used by the Thai family for living expenses.

If the Thai bank account is in the name of the expat, he/she has to inform the IRS of the bank account as long as the account amount is over $10,000. Since the amount transferred monthly is $1500, the annual amount transferred is over the $10,000 limit. The IRS will assume that it is being transferred into the Thai bank account as a savings account for the expat. They will be able to trace the transfers if they can get access to the U.S. bank transfer records (especially if it is a swift or wire transfer from the U.S. bank to the Thai bank).

The IRS is likely to assume the money is being sent overseas to the Thai bank account as a savings account to avoid paying tax on the money.

It will be up to the expat to prove that he/she is using the money to support the Thai family. That requires the Thai bank records showing a monthly transfer and corresponding withdrawals from the the Thai bank (either by a cash withdrawal or an ATM withdrawal).

I can see potential trouble with the IRS over this.

P.S. There used to be a bar on Patpong that sold a T-shirt that said,

"Fight Organized Crime.....Abolish the IRS".

So it is the sum total moved through the account in one year ? I thought it would be if the total ever exceeded 10k USD during the year....But then again I am not in a position to file ...Just curious.

As for the IRS assuming wouldn't that only occur after a flagging of an amount exceeding 10k being moved either by the US or TL banks?

I think I saw that T shirt

[flying]

nowhere in any jurisdiction of the civilised world has a taxman the paramount powers which the IRS has and is able to apply without a judge respectively a court decision involved.

Hence all the great songs by folks like Beatles, Stevie Ray Vaghan etc....

Sad when you consider our roots.

That aside it is surely one of the main reasons countries/folks think the USD is so strong.

They feel the promise of the paper is strong because we will be bled by our friendly tax man. It is after all only our promise to kick in that gives these dollars any power.

Interesting times ahead I think....

You cannot suck blood from a stone they say & a lot of folks here are looking...stoney for lack of better description

Edited May 6, 2009 by flying

[Texpat]

If that expat is on a Non-imm O visa, he must deposit, at minimum, more than $13K to maintain his visa. That would be a lot of very small fires to put out.

I seriously doubt the IRS is overly concerned about sums less than $100K.

Edited May 6, 2009 by Texpat

[Scott123]

I have been living in Thailand for 2 years. I don't have any bank account in Thailand. For my expense here, I use U.S. ATM to withdraw cash and I use U.S. credit cards.

What assumption would IRS be making on me?

Edited May 6, 2009 by Scott123

[Jingthing]

I have been living in Thailand for 2 years. I don't have any bank account in Thailand. For my expense here, I use U.S. ATM to withdraw cash and I use U.S. credit cards.

What assumption would IRS be making on me?

Nothing changes with the new legislation for a case like yours. There is such a thing as a lifestyle audit if the IRS learns you are living way beyond the means implied by the assets/income they know about.

[flying]

Nothing changes with the new legislation for a case like yours. There is such a thing as a lifestyle audit if the IRS learns you are living way beyond the means implied by the assets/income they know about.

Fortunately America is still spelled with a C & not a K

So he can say pretty much anything he wants.

He can say his girl friend support him. He is a kept man

The burden of proof is then in their court.

[Naam]

I have been living in Thailand for 2 years. I don't have any bank account in Thailand. For my expense here, I use U.S. ATM to withdraw cash and I use U.S. credit cards. What assumption would IRS be making on me?

Nothing changes with the new legislation for a case like yours. There is such a thing as a lifestyle audit if the IRS learns you are living way beyond the means implied by the assets/income they know about.

i envision IRS agents running around in Pattaya and Nakhon Nowhere questioning cashiers in restaurants and bars about the spending habits of retired Americans and then compare whether they are in line with the tax returns the next logical step is that by legislation Americans are not allowed to retire abroad where lifestyle checks are rather difficult to conduct

[PeaceBlondie]

Lifestyle audits were neither common nor useful. Unless your name was Al Capone......

[OriginalPoster]

Well I just watched his speech and don't have a text link for this yet, but the gist of it that Obama is going to request that all foreign banks issue USA IRS 1099's to US nationals having accounts with them, and if they don't, the IRS will just assume the worse about the US taxpayers and tax accordingly.

The US government has to get the money somewhere and we are as good a target as anybody. Just a heads up, if you getting any income from Thai bank accounts, even piddly interest, you had best REPORT it. And don't forget your treasury forms due June 30. They are now asking for more specific info on the dollar amounts in these accounts. I smell some hassles coming for many of us, innocent or not ...

While most of us are small potatoes compared to the big corps like Coke which are the fat targets, they are hiring a bunch of new agents to focus on foreign issues, so we might be collateral damage. Enjoy ...

The president will also direct the Internal Revenue Service to more closely scrutinize the tax returns of individuals with offshore accounts and investments, which are often used to avoid paying U.S. taxes

You're right...it could be a potential problem for U.S. expats in Thailand.

Consider this possiblity:

An American expat either working in or out of Thailand, and supporting a Thai family in Thailand.

This expat opens a bank account in Thailand so he/she can transfer money every month to his/her family in Thailand.

Let's assume the amount transferred is about $1500 a month, which is used by the Thai family for living expenses.

If the Thai bank account is in the name of the expat, he/she has to inform the IRS of the bank account as long as the account amount is over $10,000. Since the amount transferred monthly is $1500, the annual amount transferred is over the $10,000 limit. The IRS will assume that it is being transferred into the Thai bank account as a savings account for the expat. They will be able to trace the transfers if they can get access to the U.S. bank transfer records (especially if it is a swift or wire transfer from the U.S. bank to the Thai bank).

The IRS is likely to assume the money is being sent overseas to the Thai bank account as a savings account to avoid paying tax on the money.

It will be up to the expat to prove that he/she is using the money to support the Thai family. That requires the Thai bank records showing a monthly transfer and corresponding withdrawals from the the Thai bank (either by a cash withdrawal or an ATM withdrawal).

I can see potential trouble with the IRS over this.

P.S. There used to be a bar on Patpong that sold a T-shirt that said,

"Fight Organized Crime.....Abolish the IRS".

Under that scenario, all you have to do is save your bank statements to prove how much money interest each of the accounts earned. And that would only be needed if you get audited, otherwise all you have to do is enter the amount if interest earned on Schedule B of your income tax return. You shouldn't have a problem unless the IRS finds accounts that you didn't tell them about. It is still the amount of interest earned that gets taxed, not the principal, and it only increases your tax bill in the sense that now it's going to be harder to hide foreign interest income from the IRS.

[OriginalPoster]

I have been living in Thailand for 2 years. I don't have any bank account in Thailand. For my expense here, I use U.S. ATM to withdraw cash and I use U.S. credit cards. What assumption would IRS be making on me?

Nothing changes with the new legislation for a case like yours. There is such a thing as a lifestyle audit if the IRS learns you are living way beyond the means implied by the assets/income they know about.

i envision IRS agents running around in Pattaya and Nakhon Nowhere questioning cashiers in restaurants and bars about the spending habits of retired Americans and then compare whether they are in line with the tax returns the next logical step is that by legislation Americans are not allowed to retire abroad where lifestyle checks are rather difficult to conduct

Not economical to investigate the small fish and it too hard to win each case, otherwise they'd do it. There are a lot of tradesman, for instance, who do work "off the books" in the States and get paid in cash. It's pretty rare for people like that to get caught.

So-called lifestyle audits are better suited for going after big fish. That's basically how Al Capone was brought down, they could never pin racketeering charges on him but they were able to make tax evasion charges stick.

Edited May 7, 2009 by OriginalPoster

[thaihome]

You're right...it could be a potential problem for U.S. expats in Thailand.

Consider this possiblity:

An American expat either working in or out of Thailand, and supporting a Thai family in Thailand.

This expat opens a bank account in Thailand so he/she can transfer money every month to his/her family in Thailand.

Let's assume the amount transferred is about $1500 a month, which is used by the Thai family for living expenses.

If the Thai bank account is in the name of the expat, he/she has to inform the IRS of the bank account as long as the account amount is over $10,000. Since the amount transferred monthly is $1500, the annual amount transferred is over the $10,000 limit. The IRS will assume that it is being transferred into the Thai bank account as a savings account for the expat. They will be able to trace the transfers if they can get access to the U.S. bank transfer records (especially if it is a swift or wire transfer from the U.S. bank to the Thai bank).

The IRS is likely to assume the money is being sent overseas to the Thai bank account as a savings account to avoid paying tax on the money.

It will be up to the expat to prove that he/she is using the money to support the Thai family. That requires the Thai bank records showing a monthly transfer and corresponding withdrawals from the the Thai bank (either by a cash withdrawal or an ATM withdrawal).

I can see potential trouble with the IRS over this.

P.S. There used to be a bar on Patpong that sold a T-shirt that said,

"Fight Organized Crime.....Abolish the IRS".

It is not the sum of deposits over a year, it is if the balance was over $10k at any point or the sum of all accounts was over 10k on any day. Note the exchange rate conversion is taken on that day. The expat in question would not be required to report the account to the US Treasury (you don't report it directly to the IRS).

I find your scenario somewhat ludicrous and a distinct attempt to just find something the complain about. But then, you must fit right in around here.

TH

Edited May 7, 2009 by thaihome

[Jingthing]

I never meant to imply nor did I ever suggest that the changes for expat taxpayers have any relation to lifestyle audits. I agree they are not something for average people to worry about, expat or not.

As far as the exchange rate, another poster said the form said to use the exchange rate on the LAST DAY OF THE TAX YEAR. That is not the same rate as the day your balance went highest, unless they are the same day.

Edited May 7, 2009 by Jingthing

[NHC]

Yeah, I like Obama...

Can I get ya another glass of grape cool-aid friend?

...sigh

[Jingthing]

Yeah, I like Obama...

Can I get ya another glass of grape cool-aid friend?

...sigh

You do realize he is massively popular? Not only in the US but all over the world.

Just like most people who do like him, I don't agree with each and every thing he does. For example, I think he is going too slow with Cuba, I say just drop the entire embargo, its been 50 years, and it failed. Why should Cuban Americans get special rights that I don't get? Makes double pricing in Thailand rather trivial in comparison.

Edited May 7, 2009 by Jingthing

[flying]

You do realize he is massively popular? Not only in the US but all over the world.

He is popular because the ballot did not include a None of the Above tick box.

Yes I voted for him or I should say against the other.

I had high hopes that were quickly extingished as soon as he appointed his cabinet. Same Old Same Old & In some ways worse.

It has not shaped up since then.

His march into Afghanistan will end the same way it has for The British, The Russians & Even Alexander the Great & many others through out history.....Does he really need more on his plate?

Hard to believe America who was on the front of the charge to track Nazi criminals for many years after WWII Yet cannot procecute the folks guilty of waterboarding torture & more at Guantanamo Bay. This will soon haunt him.

http://news.bbc.co.uk/2/hi/americas/8006597.stm

Things like these do not make me hopeful.

Things like these can only lead to him & the USA in general being unpopular.

Do we really need to have shoes thrown?....again

Lastly here are the approval ratings after 100 days & how they compare...

President Obama enjoys approval ratings of about 62 percent*. Other president approval ratings after 100 days are similarly high: Carter 76 percent, Reagan 83 percent, G. H.W. Bush 65 percent, Clinton 55 percent, and G.W. Bush 63 percent. So President Obama’s ratings are solid but not necessarily skyrocketing and leaving a hole in the roof.

Edited May 7, 2009 by flying

[Naam]

Yeah, I like Obama...

Can I get ya another glass of grape cool-aid friend?

...sigh

You do realize he is massively popular? Not only in the US but all over the world.

not only popular. the citizens of Afghanistan and Pakistan just love him. being the new commander in chief he has not only promised more free gifts (such as cluster bombs and similar goodies) but had his promise carried out several times. one of the reasons O'Bama seems to be popular is the fact that he has irish roots. it is a well known fact that the Irish are popular all over the world. Panama-born McCain never had a chance. Americans do not (yet) vote for "greasers".

[Texpat]

Obama's War in Afghanistan is a grim reminder that we shouldn't elect community organizers as president.

Don't blame me.

[Jingthing]

Before the mods close this, best to stop the US politics debate. The thread is about US expat tax changes.

[flying]

Before the mods close this, best to stop the US politics debate. The thread is about US expat tax changes.

LOL.....

1) You brought it up

2) The thread is about Side Of Effects Of Obama's Foreign Business Tax Crackdown

3) As such you would have to look to one of those cabinet members I mentioned

Timothy Franz Geithner United States Secretary of the Treasury

The Secretary is responsible for formulating and recommending domestic and international financial, economic, and tax policy,

Although in many ways I applaud a tax dodger being in charge of such things I am sure in many ways it is quite contradictory isn't it?

Edited May 7, 2009 by flying

[PeaceBlondie]

Shall we limit further discussion here to personal affects on US expats, for personal income taax?

[OriginalPoster]

Yeah, I like Obama...

Can I get ya another glass of grape cool-aid friend?

...sigh

You do realize he is massively popular? Not only in the US but all over the world.

not only popular. the citizens of Afghanistan and Pakistan just love him. being the new commander in chief he has not only promised more free gifts (such as cluster bombs and similar goodies) but had his promise carried out several times. one of the reasons O'Bama seems to be popular is the fact that he has irish roots. it is a well known fact that the Irish are popular all over the world. Panama-born McCain never had a chance. Americans do not (yet) vote for "greasers".

That rant illustrates the point about Obama's popularity outside the US rather well. His popularity is vast to the point that most of the derision that he derives overseas is from people who will deride Americans no matter what. Of course you don't like him.

[Naam]

Of course you don't like him.

fact is that i liked him as well as his proclaimed intentions a lot. although i thought he might not make it i was hoping that he will be the next president. i started to dislike him when he had a big mouth promising millions of new jobs although any ignorant headhunter in Papua New Guinea as well as my gardener knew that was impossible. Oh..Bama must have known too, i therefore consider him a goddàmn liar. my views deteriorated further when i realised that he is not willing to make any changes on dozens of important issues such as Israel/Palestine, Iraq, Afghanistan, Guantanamo and last not least on hundreds of millions banker bonusses except for some pussyfooting and lame beating around the bush.

his enemies were right and i was obviously wrong. Obama is nothing but an inexperienced big mouth, "all hats and no cattle" (as they say in Texas). having said so, i admit that he is a better choice than a rightwing warrior (guided, influenced and pressured by a lobby who's ethnicity cannot be spoken out publicly) like McCain or his predecessor the texan village idiot.

[Naam]

Shall we limit further discussion here to personal affects on US expats, for personal income taax?

mea culpa!

[PeaceBlondie]

Mai bpen rai, Naam. Your meas are less culpable than a mia noi.