Us Irs Reporting For Dual Citizen - No Income In Us

[floridaguy]

So, I am an American and Thai citizen. I earn no money at all in the US, but I still have a financial presence there (I own some houses, various credit card debt, student loan debt). Now I am employed here as a Thai citizen, earning baht using my Thai ID number. So, do I have to still file a US tax return, as I always have in the past as a wage earner? What happens in 10 years when I have no financial presence in the US, no credit cards, no mortgage, totally off the US "grid", and earning all my income here? Am I forever bound as a US citizen to file forever no matter what?

[taxout]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

[craigt3365]

Check out this link:

http://taxes.about.com/od/taxhelp/a/ForeignIncome_3.htm

There is an exclusion on income earned overseas. This year it is $91,500. Now this is for EARNED income. Money you get from a job. If it is interest or dividends, etc....it does not qualify. You also have to be out of the US for a certain amount of time...like 11 months.

So I would file the US return and unless you are making big bucks, you won't owe anything...but you will be OK with the IRS.

Also, if you are a US citizen and have a bank account overseas, you need to file a special form. I can't remember what it is, but it is a BIG deal. I use TurboTax and it alerts me to this and prepares the form automatically. It has nothing to do with taxes, they just want to know how much money you have and where it is. Isn't Uncle Sam great?

[rfukata]

Check out this link:

http://taxes.about.c...ignIncome_3.htm

There is an exclusion on income earned overseas. This year it is $91,500. Now this is for EARNED income. Money you get from a job. If it is interest or dividends, etc....it does not qualify. You also have to be out of the US for a certain amount of time...like 11 months.

So I would file the US return and unless you are making big bucks, you won't owe anything...but you will be OK with the IRS.

Also, if you are a US citizen and have a bank account overseas, you need to file a special form. I can't remember what it is, but it is a BIG deal. I use TurboTax and it alerts me to this and prepares the form automatically. It has nothing to do with taxes, they just want to know how much money you have and where it is. Isn't Uncle Sam great?

True. any income received under the 1099 series form will need to be filed & reconciliated (such as rental income, interest income, retirement income etc) at year end.

Bank account overseas reporting should be filed annually as the earlier OP stated: the form is called TDF 90-22.1 Department of the Treasury, "Report of Foreign Bank and Financial Accounts". This form can be accessed through Web for downloading, you can google this.

[highchol]

crikey...who would want to be an american these days:huh:

[craigt3365]

crikey...who would want to be an american these days:huh:

Tough for sure...especially with all those who love to bash the USA. But at least it beats being a Somalian!

[floridaguy]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

Well, I can't believe it! Why would I need to disclose to the IRS that I own a Thai corporation if I own it as a Thai citizen, no US citizenship information used? Why would I need to disclose my Thai bank accounts if I opened them with my Thai ID, not my US passport? They don't even know I am American here, I never tell anyone that I am a dual citizen when I open bank accounts, cable tv, phone, companies, cars/motorcycles.

And what happens if I don't earn anything under my US social security number, have no US assets or assets purchased with US funds, have no US bank accounts, no US property, etc. What happens if I stop filing? What can they do? They can't garnish my wages, I don't have any. They can't prosecute me for tax evasion, I don't have any US income. They can't take my property, I don't have any. I can't see them prosecuting me for such a crime as not filing, and asking Thailand to extradite me. They can't even get the biggest arms dealer in the world extradited!

To me it seems like 2 separate identities almost, in a legal way. I should only need to report to the US authorities for things that I do as a US citizen, such as assets, debts, income, traveling as a US citizen, etc. And vice versa for Thailand. Those things that are done in my name as a Thai citizen should not have to cross over, and vice versa. The only common element among everything is my name, birthday. That is it.

Jeesh, the US government is intrusive aren't they?

[floridaguy]

Check out this link:

http://taxes.about.c...ignIncome_3.htm

There is an exclusion on income earned overseas. This year it is $91,500. Now this is for EARNED income. Money you get from a job. If it is interest or dividends, etc....it does not qualify. You also have to be out of the US for a certain amount of time...like 11 months.

So I would file the US return and unless you are making big bucks, you won't owe anything...but you will be OK with the IRS.

Also, if you are a US citizen and have a bank account overseas, you need to file a special form. I can't remember what it is, but it is a BIG deal. I use TurboTax and it alerts me to this and prepares the form automatically. It has nothing to do with taxes, they just want to know how much money you have and where it is. Isn't Uncle Sam great?

Interesting, but I don't earn my income under my social security number. I earn it as a Thai citizen on my Thai ID number, I pay Thai taxes. I have Thai bank accounts, but they are funded by my wages earned as a Thai citizen, not by any money paid to me as a US citizen, nor transfered from the US.

[steelepulse]

>>crikey...who would want to be an american these days:huh:

Especially with the Treasury printing press running non stop and the currency perpetually dropping due to said printing presses and 1.3 TRILLION DEBT.

If I were the OP, I would file taxes and as long as you are under the 91K or whatever the amount is you'll suffer no taxes and be in the good graces of Uncle Sam if for any reason you want to go back and live/earn in the US as a US citizen.

[taxout]

Your viewpoint is understandable, but it's plainly not the The Law.

Remember Steven Cheung, a well-known economics professor in Hong Kong and a US citizen, who didn't bother to report the money he was making on his parking lots in Hong Kong to Uncle Sam. Well, Uncle didn't like this, and charged him with criminal tax fraud in 2003.

http://www.justice.g...eung012803.html

Steven Cheung, the once eminent economist, has since been cooling his heels in Mainland China, where he doesn't have to worry about extradition.

Edited October 10, 2010 by taxout

[floridaguy]

Your viewpoint is understandable, but it's plainly not the The Law.

Remember Steven Cheung, a well-known economics professor in Hong Kong and a US citizen, who didn't bother to report the money he was making on his parking lots in Hong Kong to Uncle Sam. Well, Uncle didn't like this, and charged him with criminal tax fraud in 2003.

http://www.justice.g...eung012803.html

Steven Cheung, the once eminent economist, has since been cooling his heels in Mainland China, where he doesn't have to worry about extradition.

Wow, that is crazy. He is definately a bigger fish than me, earning tens of millions of dollars a year, but certainly gives us Americans pause. The IRS is often used as a tool for other law enforcement agencies, look at Al Capone. So it looks like Cheung was on the wrong side of the law for a long time, selling fake antiques. But I couldn't find any information about him being a US citizen. He was born in Hong Kong, which makes him a Chinese and British (?) citizen. Also, the indictments were clear to state that he benefitted in the US from his income, which may have been a requirement in the federal courts to prove although he earned income abroad, he transferred the money to the US to his wife, who was a resident of Seattle.

Anyway, thank you Taxout for the information. I have sent an email to the IRS, and will follow up with a phone call tomorrow to the IRS and maybe a tax accountant familiar with this issue.

I don't have anything to hide, and know I will not owe any taxes, but since living here in Thailand, my strong "contempt of authority" is really kicking in. I don't want to file, just because! I guess my nationalistic Thai side is rebelling against my patriotic American side.

Ah well, I will update this thread after I speak to the IRS and a tax attorney/accountant.

[taxout]

There are various reports on the web that Cheung is a naturalized US citizen.

If the allegations are true, his actions would be criminal whether or not funds were transferred to the US.

(As an aside, green card holders are generally subject to the same tax requirements as US citizens.)

Edited October 10, 2010 by taxout

[craigt3365]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

Well, I can't believe it! Why would I need to disclose to the IRS that I own a Thai corporation if I own it as a Thai citizen, no US citizenship information used? Why would I need to disclose my Thai bank accounts if I opened them with my Thai ID, not my US passport? They don't even know I am American here, I never tell anyone that I am a dual citizen when I open bank accounts, cable tv, phone, companies, cars/motorcycles.

And what happens if I don't earn anything under my US social security number, have no US assets or assets purchased with US funds, have no US bank accounts, no US property, etc. What happens if I stop filing? What can they do? They can't garnish my wages, I don't have any. They can't prosecute me for tax evasion, I don't have any US income. They can't take my property, I don't have any. I can't see them prosecuting me for such a crime as not filing, and asking Thailand to extradite me. They can't even get the biggest arms dealer in the world extradited!

To me it seems like 2 separate identities almost, in a legal way. I should only need to report to the US authorities for things that I do as a US citizen, such as assets, debts, income, traveling as a US citizen, etc. And vice versa for Thailand. Those things that are done in my name as a Thai citizen should not have to cross over, and vice versa. The only common element among everything is my name, birthday. That is it.

Jeesh, the US government is intrusive aren't they?

This is for sure the law. Ignore it, and you are OK as long as you don't want to visit the US again. IMHO, the odds are very, very low they would chase you for not reporting a bank account you have here in Thailand. BUT! If they do an audit, and you don't have this reported, it is a big, big, big deal.

Also, IMHO, who cares. They know about all your stuff in the US (and for good reason). This form is primarily for money laundering purposes. If you are involved in that, then it really doesn't matter. My tax software fills it out automatically, all I have to do is mail it. No biggie...

But I sure understand your situation. Having nothing in the US, but having to report this stupid form. Because with no income tax due, you never have to file. Sucks, but other countries have their own problems. Like, if I am not mistaken, to keep your free medical benefits, don't Canadian's have to return home every year for a certain time? And if you are from the UK, and paying taxes, you can not stay for more than a certain amount of time or it changes your tax status?

[cloudhopper]

Jeesh, the US government is intrusive aren't they?

They're going to hunt you down and fine you for not having health insurance.

[givenall]

I use professional tax accountant for my US tax filling and last year I had to disclose my company over here both invest value and the annual earning, my personal earning and any bank that I have with more than 10,000 at anytime during the year, and there is no exclusion. There are penalties if you do not do comply

[HerbalEd]

crikey...who would want to be an american these days:huh:

The tens of thousands of immigrants who file for citizenship every year do.

[HerbalEd]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

Well, I can't believe it! Why would I need to disclose to the IRS that I own a Thai corporation if I own it as a Thai citizen, no US citizenship information used? Why would I need to disclose my Thai bank accounts if I opened them with my Thai ID, not my US passport? They don't even know I am American here, I never tell anyone that I am a dual citizen when I open bank accounts, cable tv, phone, companies, cars/motorcycles.

And what happens if I don't earn anything under my US social security number, have no US assets or assets purchased with US funds, have no US bank accounts, no US property, etc. What happens if I stop filing? What can they do? They can't garnish my wages, I don't have any. They can't prosecute me for tax evasion, I don't have any US income. They can't take my property, I don't have any. I can't see them prosecuting me for such a crime as not filing, and asking Thailand to extradite me. They can't even get the biggest arms dealer in the world extradited!

To me it seems like 2 separate identities almost, in a legal way. I should only need to report to the US authorities for things that I do as a US citizen, such as assets, debts, income, traveling as a US citizen, etc. And vice versa for Thailand. Those things that are done in my name as a Thai citizen should not have to cross over, and vice versa. The only common element among everything is my name, birthday. That is it.

Jeesh, the US government is intrusive aren't they?

You can easily fix this problem. Give up your American citizenship. Seriously .... you can do that ... but I bet you never will. Why?

[gotlost]

crikey...who would want to be an american these days:huh:

Ask the approximately 38 million immigrants in 2007 before you make a complete ass of yourself.

[Rama]

And if you renounce your US citizenship, expect an IRS audit. Seems there have been people who have migrated to the US and made money then went home and renounced their citizenship. The government thinks that most people that renounce their citizenship do so to avoid US taxes. There was an IRS bulletin early this year that said the IRS estimates that there is 68 Billion in uncollected taxes with expats. The IRS is opening up offices in more embassies around the world to go after those taxes. There is a rumor that they will be opening up at the US embassy in bkk.

[Heng]

And what happens if I don't earn anything under my US social security number, have no US assets or assets purchased with US funds, have no US bank accounts, no US property, etc. What happens if I stop filing? What can they do? They can't garnish my wages, I don't have any.

Dual (or rather triple) citizen here as well...

You mentioned in your original post that you own homes, if that's true they can put a lien on your home(s) if they find that you owe taxes.

I skipped out on filing for a period of almost 7 years and nothing spectacular happened (no questions no letters or anything) when I resumed filing. Only did so because all family assets stateside that were in my parent's names were to be transfer to me and my siblings so we all decided to get mostly legal as you're pretty much sitting above water in plain view with your property taxes. Also, all of our rental income revenue passes through US bank accounts and that probably couldn't be explained away in the event of an audit.

I don't bother declaring any of my Thai 'persona' revenues though. The whole point of having a Thai persona (it's certainly not for the visa benefits) is so that when I opened accounts in Singapore, HK, etc. it was Mike Hengtrakul the Thai citizen and not Mike Heng the US citizen doing so. It'll be a different story if one day the world is unified under one taxation system or the US IRS gains more 'access' to offshore info like they have in some parts of Europe. Myself I'd bet against the trend of them gaining 'more' clout though.

[floridaguy]

Jeesh, the US government is intrusive aren't they?

They're going to hunt you down and fine you for not having health insurance.

Darn, I forgot about THAT too! Does my Thai issued insurance count? US citizenship is nice, but comes at a price.

[steelepulse]

>>You can easily fix this problem. Give up your American citizenship. Seriously .... you can do that ... but I bet you never will. Why?

I had a friend that did that. He's now a proud Leprechaun and is saving heaps of cash every year.

[gregb]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

Well, I can't believe it! Why would I need to disclose to the IRS that I own a Thai corporation if I own it as a Thai citizen, no US citizenship information used? Why would I need to disclose my Thai bank accounts if I opened them with my Thai ID, not my US passport? They don't even know I am American here, I never tell anyone that I am a dual citizen when I open bank accounts, cable tv, phone, companies, cars/motorcycles.

You don't have to if you denounce your American citizenship. Then you'll simply be Thai like all the other Thais and have no responsibilities to the US government. Yes, the USA is the hated evil empire of the world. They do this because they can, and there is nothing any of us can do about it.

If you want to retain your citizenship in the USA, this is the price you pay. You are no different than any other American just because you are lucky enough to hold a Thai passport as well. Consider how the rest of the country would feel if you were treated differently from them just because you held dual citizenship. They wouldn't be too happy about that now, would they? I certainly would complain loudly if you were allowed to hold assets in Thailand tax free and I wasn't, just because you have a second passport. How are we different? I am here in Thailand legally just like you. The color of the passport we use to engage in commerce doesn't change either of our responsibilities to Uncle Sam.

So, bend over, file your forms, and pay your taxes like the rest of us. If you don't like it, write your congressman. Just don't expect him to care.

[rakman]

Yes, so long as you meet the minimum filing standards, you'll have to file income tax returns and bank account disclosures for life. There may be other filing requirements, as well -- if you own a Thai corporation, for example.

Well, I can't believe it! Why would I need to disclose to the IRS that I own a Thai corporation if I own it as a Thai citizen, no US citizenship information used? Why would I need to disclose my Thai bank accounts if I opened them with my Thai ID, not my US passport? They don't even know I am American here, I never tell anyone that I am a dual citizen when I open bank accounts, cable tv, phone, companies, cars/motorcycles.

You don't have to if you denounce your American citizenship. Then you'll simply be Thai like all the other Thais and have no responsibilities to the US government. Yes, the USA is the hated evil empire of the world. They do this because they can, and there is nothing any of us can do about it.

If you want to retain your citizenship in the USA, this is the price you pay. You are no different than any other American just because you are lucky enough to hold a Thai passport as well. Consider how the rest of the country would feel if you were treated differently from them just because you held dual citizenship. They wouldn't be too happy about that now, would they? I certainly would complain loudly if you were allowed to hold assets in Thailand tax free and I wasn't, just because you have a second passport. How are we different? I am here in Thailand legally just like you. The color of the passport we use to engage in commerce doesn't change either of our responsibilities to Uncle Sam.

So, bend over, file your forms, and pay your taxes like the rest of us. If you don't like it, write your congressman. Just don't expect him to care.

Giving up US citizenship and exiting the tax & spend system will cost ~38% in taxes, if assets are over $1 million US. Not sure if that counts Thai assets too, but I would suspect it does. A tax professional (don't ask the IRS, you'll get as many answers as IRS pros you ask) or two (get at least a second opinion) from good tax professionals. The IRS enforces laws created by the US Congress, they are just evil bureaucrats who have their own guns.

[mkawish]

You really at this point in time do not need a lawyer to represent you yet.

Your good intention has never been at this junction a subject of investigation of any sort by the IRS yet, correct?

Go on line with one of the IRS rep and honestly tell him/her what the facts are and what the circumstances are, about you?

Unless you are earning in excess of 150k usd a month regularly, you really imho should not be worrying so much.

They will come after you, if they discover you are HIDING your earnings.

In the final analysis, if you find that you are in serious predicament AND THE IRS WILL ALSO ADVISE YOU TO SEEK A REPRESENTATION (meaning get a lawyer buddie),

as in my case a decade ago, YOU CAN GET A FREE CONSULTATION AND REPRESENTATION BY GROUP OF RETIRED COUNSELS whose name I shamefully just could recall at the moment.

Any way, a lady rep from this group took up my case while I was overseas and told me that because of my own stupidity, ignorance and my willingness to confess and my desire to make it good by coming forward and confessing all, she would approach the IRS for me and she also advised me to expect zip from the IRS and within the next 6 mos prepared a Cashier's Check for 250k usd in the name of IRS, just in case.

Being honest and be willing to own up to what one did still counts for something in the good old U.S. of A.

The final decision came down to me at the end of nine months was that I would receive a refund of only one half of what had been impounded without any kind of penalty being incurred or computed against me and the best news was that there was no need for the quarter mil penalty expected. Plus the IRS would also pay interest on the refund amount. Thank you very much.

In reference to that organization, the name appears somewhere on the IRS website as I recall now. I am not certain, but that org could be--The Consumers Advocate?

Will follow your decision with interest. Good luck and good fortune to you.

Your viewpoint is understandable, but it's plainly not the The Law.

Remember Steven Cheung, a well-known economics professor in Hong Kong and a US citizen, who didn't bother to report the money he was making on his parking lots in Hong Kong to Uncle Sam. Well, Uncle didn't like this, and charged him with criminal tax fraud in 2003.

http://www.justice.g...eung012803.html

Steven Cheung, the once eminent economist, has since been cooling his heels in Mainland China, where he doesn't have to worry about extradition.

Wow, that is crazy. He is definately a bigger fish than me, earning tens of millions of dollars a year, but certainly gives us Americans pause. The IRS is often used as a tool for other law enforcement agencies, look at Al Capone. So it looks like Cheung was on the wrong side of the law for a long time, selling fake antiques. But I couldn't find any information about him being a US citizen. He was born in Hong Kong, which makes him a Chinese and British (?) citizen. Also, the indictments were clear to state that he benefitted in the US from his income, which may have been a requirement in the federal courts to prove although he earned income abroad, he transferred the money to the US to his wife, who was a resident of Seattle.

Anyway, thank you Taxout for the information. I have sent an email to the IRS, and will follow up with a phone call tomorrow to the IRS and maybe a tax accountant familiar with this issue.

I don't have anything to hide, and know I will not owe any taxes, but since living here in Thailand, my strong "contempt of authority" is really kicking in. I don't want to file, just because! I guess my nationalistic Thai side is rebelling against my patriotic American side.

Ah well, I will update this thread after I speak to the IRS and a tax attorney/accountant.

Edited October 11, 2010 by mkawish

[gk10002000]

Just about everything I read here is true. Two of my best friends have moved to Canada and have residency permits. One has a german wife, one has a canadian wife. Both orf my friends are evaluating their next step. Once they fully retire, they really are probably just about done with the USA. One has silver stars from Vietnam and both worked hard all their life, but enough is enough.

All the income things people have mentioned here are correct. The USA does have tax offset credits for foreign money earned. You might want to see how corporations handle monies. You might get that unearned income exempt in different ways. 11 months or 330 contiguous days or the other way around for the income exclusion. I forget.

You can give up your US citizenship, but it is treated like evil. But depending on your age, what do you give up? The USA won't help you out of a foreign jail. Their embassy is very hands off. You may not get any or much social security. You may not get but may not need medicare/medicaid. Diplomatically, a USA passport versus a Thai passport probably has advantages, depending on where and how often you travel. The USA will tax your social security if you make any money over 25,000, so they penalize you for being industrious. And they base the taxes on even income that is non taxable such as Municipal bonds. A real crock.

[craigt3365]

Just about everything I read here is true. Two of my best friends have moved to Canada and have residency permits. One has a german wife, one has a canadian wife. Both orf my friends are evaluating their next step. Once they fully retire, they really are probably just about done with the USA. One has silver stars from Vietnam and both worked hard all their life, but enough is enough.

All the income things people have mentioned here are correct. The USA does have tax offset credits for foreign money earned. You might want to see how corporations handle monies. You might get that unearned income exempt in different ways. 11 months or 330 contiguous days or the other way around for the income exclusion. I forget.

You can give up your US citizenship, but it is treated like evil. But depending on your age, what do you give up? The USA won't help you out of a foreign jail. Their embassy is very hands off. You may not get any or much social security. You may not get but may not need medicare/medicaid. Diplomatically, a USA passport versus a Thai passport probably has advantages, depending on where and how often you travel. The USA will tax your social security if you make any money over 25,000, so they penalize you for being industrious. And they base the taxes on even income that is non taxable such as Municipal bonds. A real crock.

A US passport is much better than a Thai passport for travel. Without, extensive international travel is just about impossible. I've tried it with my wife...no fun.

If you don't like the tax rates in the US, you can always head to Scandinavia. You will only get dinged for 50% of your income....

[samran]

Can't see the fuss...

one of the responsibilities of being a US citizen is that all of your worldwide income is taxable - even when you are living overseas.

More enlighted countries don't tax their citizens when the are non-resident, but then I guess there are pro's and con's of every citizenship.

[craigt3365]

Can't see the fuss...

one of the responsibilities of being a US citizen is that all of your worldwide income is taxable - even when you are living overseas.

More enlighted countries don't tax their citizens when the are non-resident, but then I guess there are pro's and con's of every citizenship.

It sucks for sure. I live off interest and dividends....non earned income. I don't live in the US, but it is fully taxable...sucks...

[Naam]

Can't see the fuss...

one of the responsibilities of being a US citizen is that all of your worldwide income is taxable - even when you are living overseas.

More enlighted countries don't tax their citizens when the are non-resident, but then I guess there are pro's and con's of every citizenship.

It sucks for sure. I live off interest and dividends....non earned income. I don't live in the US, but it is fully taxable...sucks...

because you have not thought of the legal solution establishing an investment company, manage the company, draw an appropriate salary as well as perks and enjoy the "foreign income exclusion" of 91,500 tax free Dollars.

it is of course not as easy as it sounds. but a few (three) of my american friends got together some years ago and after a tedious setup which took quite some time they live now happily ever after abroad and pay income tax only for the amount exceeding the exclusion.