US tax preparation living in Chiang Mai

[ChiangraiTony]

I'm residing in Chiang Mai on a visa for retirement purposes. I do not work but during 2013, I traveled to USA and transferred a large sum of money to Thailand. Theses funds were from an IRA. That was all the income for the year but it is reportable. Now, before April 15th. I have to prepare the appropriate tax forms and file with the US government. My question is: where can I get this done in Chiang Mai?

Any assistance in this area would be appreciated. thank you!

[roger1999]

You might want to give Turbo Tax a try. It's easier than you think. You don't pay them anything unless you actually file with them. It can all be done online, and will cost less than $100.

[Lobo4819]

You might want to give Turbo Tax a try. It's easier than you think. You don't pay them anything unless you actually file with them. It can all be done online, and will cost less than $100.

Ditto that.

[ChiangraiTony]

Thank you for your suggestion. I will try Turbo Tax.

[NancyL]

We'd always used a CPA, but once we retired and moved to CM I tried TaxActOnLine (a free service offered thru our Michigan credit union) almost as a lark just to see what it was like, figuring I'd still scan and email documents to the CPA in the U.S.

90 minutes later I had our taxes done! Wow, who knew it could be so easy? I expect TurboTax is much the same way.

In subsequent years it was even easier, because I didn't have to input addresses for our banks, credit unions, IRA accounts, etc. TaxActOnLine remembered them from the previous year.

It even has a module that handles the dreaded FBAR report and that other one whose name I can't remember for those of us who have to tell Uncle Sam about our foreign bank accounts.

It really helps if you're living a simple life as a retiree without any real estate holdings, interest deductions for mortgages, etc, It sounds like the OP's financial situation is fairly simple.

Edited January 14, 2014 by NancyL

[mogoso]

The IRS site gives several free Tax services. Some won't do old timers but most will and they are free for federal returns, but they all charge to do the State returns if you want them to do them

[SpokaneAl]

Hopefully you will receive your 1099R so that your retirement distribution can be combined with any other income so that you can subtract applicable deductions and exemptions and determine your tax liability. And again, hopefully, you had a sufficient amount of income withheld to cover the potential taxes due on that retirement distribution, assuming that it was not from a Roth IRA.

The biggest challenge, no matter which way you choose for your tax preparation needs, is to successfully gather all the necessary documentation.

Win that said, I agree, TurboTax is a great program, and easy to use. Just be careful when you use it - in my previous life as a tax preparer for a few years I would encounter many who blasted through the program without reading and considering the questions. The program works great if you carefully read as you go.

And with your seemingly fairly simple tax issues, you may be able to file for free, or relatively cheaply.

Sent from my iPad using Thaivisa Connect Thailand mobile app

[Rama]

Joe Krebs - tax CPA living in Chiang Mai - www.us-taxpayers.com

[cheeryble]

You might want to consider whether you will ever return and use US facilities.

If not it would be strange to pay anything, and I find it extraordinarily cheeky that USgov expects expats as a group to do so.

Sent from my iPad using ThaiVisa app

[roger1999]

I'm no expert but I think that a failure to pay taxes might put his social security check in danger of being withheld.

[cheeryble]

I'm no expert but I think that a failure to pay taxes might put his social security check in danger of being withheld.

That would be an old age.....errr "senior's"....pension?

If that is not disconnected from tax as in the UK it would indeed be a good reason to pay.

Seems a bit mad paying with one hand and receiving with the other though.

Sent from my iPad using ThaiVisa app

[SpokaneAl]

I'm no expert but I think that a failure to pay taxes might put his social security check in danger of being withheld.

That would be an old age.....errr "senior's"....pension?

If that is not disconnected from tax as in the UK it would indeed be a good reason to pay.

Seems a bit mad paying with one hand and receiving with the other though.

Sent from my iPad using ThaiVisa app

If the only income one had was from social security, then there would be no federal income taxes due. However, if combined with other income, for example investment income, that could and probably would generate some tax liability. And of course, the state in which one claimed as his/her residence, could also generate a filing requirement and/or additional taxes due. As always, it depends.

Sent from my iPad using Thaivisa Connect Thailand mobile app

[elektrified]

Joe Krebs - tax CPA living in Chiang Mai - www.us-taxpayers.com

Last I heard he was in poor health and had returned to the USA.

[Johpa]

As others noted, TurboTax should take care of all your needs using less than an hour of your time. On the downside, it is TurboTax that lobbies to prevent the government from just sending you a bill. About 60% of all taxpayers use the "standard deduction" and the government already knows all your other income. The IRS simply checks your 1040 return against the information they already have and send you a correction notice if your return does not match their information.

[Thighlander]

The poster will be taxed on his IRA distribution. It's very simple. TT will do it fine, but TaxAct cost less, and works just as well. Fidelity Investments was offering 20 off TurbTax to its customers. Other promos are out there, also.

[NeverSure]

I'm no expert but I think that a failure to pay taxes might put his social security check in danger of being withheld.

That would be an old age.....errr "senior's"....pension?

If that is not disconnected from tax as in the UK it would indeed be a good reason to pay.

Seems a bit mad paying with one hand and receiving with the other though.

Sent from my iPad using ThaiVisa app

Maybe you don't understand what he had. He had money in an account that he accumulated over time, tax free. He paid no taxes on it when he earned it. The taxes are deferred until you withdraw it. Many people withdraw that money in small amounts over time for living expenses, and they are then in a lower tax bracket than they were when they were working, so they pay a smaller rate of tax.

Also that money grows where it is invested during his lifetime. Most people consider it a really good idea and take advantage of it.

Now that he has withdrawn a large chunk of it, it will be reported to the IRS. He legitimately owes the delayed taxes on it and no one is arguing that.

And yes, if he doesn't pay his deferred taxes on that, the IRS will attach his social security checks into the future until the taxes and penalties for late payment and interest on unpaid taxes is cleared.

All he has to do is pay the legitimate deferred taxes and he's golden. No interest and no penalties - just the ordinary taxes. It's more than fair.

[NancyL]

You might want to consider whether you will ever return and use US facilities. If not it would be strange to pay anything, and I find it extraordinarily cheeky that USgov expects expats as a group to do so. Sent from my iPad using ThaiVisa app

Cherryble, you may wish to refrain from giving tax advise to U.S. citizens. I see from some of your previous posts that you're normally rather sensible, but I suspect you're not a U.S. national.

Clearly, you don't understand how an IRA functions, in that the U.S. federal (and possible state) income tax obligation becomes due at the time the owner withdraws (and utilizes) the money during retirement years, not at the time the funds are deposited into the account. It doesn't matter if the owner of the account lives overseas and if the owner ever plans to return to the U.S. again.

Failure to pay U.S. income taxes results in very stiff penalties and steep interest on those penalties. It's amazing how a small tax bill can grow to something very, very big when ignored for years. And while the tax collection agency can possibility be ignored while someone is living overseas, it may be more difficult for someone's loved ones to benefit from their assets after their death once it becomes known where you were living upon your death. In other words, you may not be doing your family any favors by failing to file U.S. income taxes where you're living overseas. Your "oversight" could create problems for them upon your death.

[mesquite]

You might want to consider whether you will ever return and use US facilities. If not it would be strange to pay anything, and I find it extraordinarily cheeky that USgov expects expats as a group to do so. Sent from my iPad using ThaiVisa app

Cherryble, you may wish to refrain from giving tax advise to U.S. citizens. I see from some of your previous posts that you're normally rather sensible, but I suspect you're not a U.S. national.

Clearly, you don't understand how an IRA functions, in that the U.S. federal (and possible state) income tax obligation becomes due at the time the owner withdraws (and utilizes) the money during retirement years, not at the time the funds are deposited into the account. It doesn't matter if the owner of the account lives overseas and if the owner ever plans to return to the U.S. again.

Failure to pay U.S. income taxes results in very stiff penalties and steep interest on those penalties. It's amazing how a small tax bill can grow to something very, very big when ignored for years. And while the tax collection agency can possibility be ignored while someone is living overseas, it may be more difficult for someone's loved ones to benefit from their assets after their death once it becomes known where you were living upon your death. In other words, you may not be doing your family any favors by failing to file U.S. income taxes where you're living overseas. Your "oversight" could create problems for them upon your death.

NancyL is quite correct on this. While I personally have had no problems with the IRS, I've had friends - perhaps we all have - who have gotten into a bit of trouble and then taken the ostrich with its head in the sand approach, ignoring it. The fines and penalties add up and eventually the IRS files liens and seizes bank accounts. The IRS is like a pit bull and will not let go until it is satisfied.

Filling out the FBAR and filing online is fairly easy, and keeping everything squeaky clean prevents adverse action as a result of a "tip" to the IRS from an aggrieved ex-spouse or a person jealous of a Chiang Mai expat's enviable lifestyle.

Edited January 15, 2014 by mesquite

[vagabond48]

I have been using the free downloaded federal tax version of taxact for 7 years. It takes care of the normal tax reporting needs such as bank interest, stock dividends and sales, pension, home sales and IRA distribution. Having 95% of US financial statements available online, makes tax reporting that much easier. The inexpensive paying version has an feature to import informaton from the previous tax year that is handy for those of us who don't like to do too much data entry. Of course, you need to be a bit computer literate.

[Thighlander]

There you go...free, I had been paying only because I had to do state, many expats wouldn't need too. Even if your a resident of that State. Tax Act will let you save it in a pdf file, too. Keep a copy in your email or on a thumb drive.

[ChiangraiTony]

I greatly appreciate all the valuable feedback, this is most helpful.

[Mapguy]

You might want to consider whether you will ever return and use US facilities. If not it would be strange to pay anything, and I find it extraordinarily cheeky that USgov expects expats as a group to do so. Sent from my iPad using ThaiVisa app

Cherryble, you may wish to refrain from giving tax advise to U.S. citizens. I see from some of your previous posts that you're normally rather sensible, but I suspect you're not a U.S. national.

Clearly, you don't understand how an IRA functions, in that the U.S. federal (and possible state) income tax obligation becomes due at the time the owner withdraws (and utilizes) the money during retirement years, not at the time the funds are deposited into the account. It doesn't matter if the owner of the account lives overseas and if the owner ever plans to return to the U.S. again.

Failure to pay U.S. income taxes results in very stiff penalties and steep interest on those penalties. It's amazing how a small tax bill can grow to something very, very big when ignored for years. And while the tax collection agency can possibility be ignored while someone is living overseas, it may be more difficult for someone's loved ones to benefit from their assets after their death once it becomes known where you were living upon your death. In other words, you may not be doing your family any favors by failing to file U.S. income taxes where you're living overseas. Your "oversight" could create problems for them upon your death.

NancyL is correct to point out the consequences of avoiding taxes, but she does not understand IRAs. They are definitely not all treated the same tax-wise as she indicates for the owners or for their beneficiaries. To get a simplified view, just Google "Traditional IRA" (to which NancyL refers) and "Roth IRA," for which taxation works quite differently. Go here for a much more thorough overview of the different kinds of IRAs and their tax treatment:

http://en.wikipedia.org/wiki/Individual_retirement_account

http://www.irs.gov/Retirement-Plans/Individual-Retirement-Arrangements-(IRAs)-1

Otherwise, I would also endorse TurboTax, which I have used for many, many years. It seems to get better and better each year. It will also help you with your foreign resident status, if that is your situation.

[Dante99]

I'm no expert but I think that a failure to pay taxes might put his social security check in danger of being withheld.

Not just put in danger, it has happened and it is not necessarily announced in advance.

[NancyL]

So there you go -- there appears to be consensus that failure to file taxes is an incredibility bad idea for Americans, even if it appears that you can get away with it in the short term. There can be long-term consequences, if not for you then for your heirs when it's time to settle your estate.

Also, it seems that everyone who has first-hand experience with TurboTax agrees that's it a good, even handling the ins-and-outs of the special tax filing needs of Americans living abroad just fine.

[sfokevin]

You might want to consider whether you will ever return and use US facilities.If not it would be strange to pay anything, and I find it extraordinarily cheeky that USgov expects expats as a group to do so.Sent from my iPad using ThaiVisa app

This is incredibly stupid advise!!!... The OP would very quickly find his IRA nest egg frozen

[Thighlander]

Many accountants and accounting firms use TurboTax. Their CPA signs it, and charges you $$$, but some people simply have to use a private CPA for their own asset protection. TT also offers a guarantee of representing you at an audit, if necessary for a small upfront fee, when you file.

[TallGuyJohninBKK]

I've used the online Turbo Tax version for the past several years with no problems, despite having a somewhat complicated tax return. The important thing is to read carefully and consider the questions and info the program presents to you, so you can provide the correct responses.

Previously, I was paying a local tax return person in BKK about 10,000 baht per year for my federal return. Now I'm paying about $50 (1500b) to TurboTax.

As for non-payment of U.S. taxes, I believe I've also read here in the past that a U.S. citizen in that situation also could face having a hold placed on their passport renewal (when it comes up) at the U.S. Consulate.

If a person can't get a new/valid passport, that's going to make staying in compliance with Thai Immigration impossible, not to mention being able to travel outside of Thailand.

[SpokaneAl]

Many accountants and accounting firms use TurboTax. Their CPA signs it, and charges you $$$, but some people simply have to use a private CPA for their own asset protection. TT also offers a guarantee of representing you at an audit, if necessary for a small upfront fee, when you file.

Actually, Per IRS regulations, you can e-file up to five (5) federal returns using TurboTax software. Turbo Tax is for retail customers. Intuit, the company that owns TT does offer a professional tax preparer suite.

Sent from my iPad using Thaivisa Connect Thailand mobile app

[NeverSure]

In addition to Turbo Tax, I recommend a program which interfaces with it called "It's Deductible." It itemizes all such things as charitable contributions. I always have a long list of those because I prefer to give things to a mens' or womens' shelter than to sell them when I'm finished. The program gives a generous estimate of what the items are worth, and I've never been challenged.

[Mekong Bob]

Joe Krebs - tax CPA living in Chiang Mai - www.us-taxpayers.com

Last I heard he was in poor health and had returned to the USA.

Well, it's tax time again! Any Americans here in Chiang Mai using a USA tax preparer. Joe Krebs has done a very nice job for me over the years, but he's on an "extended leave" in the USA. No return date mentioned on his voice mail today.

Can you recommend a licensed tax preparer to me?

Thank you.