First time US tax filer: I made a few thousand $s teaching; Do I need to file?

[AjarnKim14]

This is the first time I'll be filing taxes while living in Southeast Asia. I was at three jobs in Thailand in 2014 and I made a few thousand dollars teaching. One paid by check, one paid in cash and one paid by bank deposit. Are US citizens living in Thailand and making under a certain amount exempt from taxes? If not, what form do I use to file? I made so little. Is it possible I could be getting a refund if I file. Thank you so much for your help. This is my first time to attempt the process.

[HeijoshinCool]

Google accountants in your home town. Email a few. You probably won't get a response until the end of April, but they will be the best source of accurate info.

April 15th is not the deadline in your case, so no problem there.

[DPGumbypgh]

If you are single and earned less than US$10150 then you do not need to file.

If you have not paid any taxes then you will not get anything back unless you you have legal children whom are us citizens.

Edited April 14, 2015 by DPGumbypgh

[BudRight]

You should not file. There is no reason to; even the IRS doesn't want your W4 if your income is less than 10 grand.

[HeijoshinCool]

Even if you are not required to file, or are and owe nothing, there could be benefits to filing that would be reaped in the next few years' tax returns.

Your interests would best be served by consulting an accountant via email, not TV armchair tax experts.

[Pib]

Go to the IRS webpage titled "Do I Need to File a Tax Return" and complete their questions to find out: Link

Snapshot from the webpage follows.

[Jingthing]

If it was me I wouldn't file if that's the sum of your income. But look into it as you may have other types of income that would require filing.

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[skatewash]

If you have any foreign financial accounts, for example, a bank account in Thailand, and if the aggregate value of such accounts at any point in a calendar year exceeds $10,000 you will need to file FinCEN Form 114 (formerly Treasury Department Form 90-22.1) Report of Foreign Bank and Financial Accounts (FBAR).

More here: http://bsaefiling.fincen.treas.gov/NoRegFBARFiler.html

[Jingthing]

True but that is a separate matter from IRS requirements.

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[HeijoshinCool]

Today I asked my accountant the obvious question on my mind:

If the OP traveled to Thailand to teach, can travel and other costs be written off?

Yep.

So if you return stateside in the next few years and get a good paying job, this could be a write-off then.

Checking the IRS website only tells you if you are "legally" obligated to file. It does not tell you if it is in your best interests to file.

[skatewash]

True but that is a separate matter from IRS requirements.

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Based on the fact that the OP was inquiring about his obligations to the IRS based on being a US citizen living overseas, I thought it might perhaps be a good idea to mention another obligation imposed by the same Department of Treasury on US citizens having financial interests overseas. It seemed likely the OP might now have a financial interest overseas, say a Thai bank account, as he lives and works in Thailand. It also seemed from the nature of the OP's question that it might be the first time he has lived or worked overseas and therefore he might be unaware of this other obligation, which is more likely to affect expats than those who live and work inside the US.

It's a good thing to make clear that the FBAR is filed separately from the tax return, and there are different filing requirements, including different deadlines for filing. It is possible that a particular person could be required to file one or the other, both, or neither, depending on their individual circumstances.

Just a heads up to the OP, since the penalties for failing to file an FBAR (if required to do so) are worse than tax penalties. Given the draconian penalties associated with non-filing of the FBAR I thought it might be a forgivable breach of etiquette to stray off the topic and mention it.

[Langsuan Man]

True but that is a separate matter from IRS requirements.

Sent from my Lenovo S820_ROW using Thaivisa Connect Thailand mobile app

Based on the fact that the OP was inquiring about his obligations to the IRS based on being a US citizen living overseas, I thought it might perhaps be a good idea to mention another obligation imposed by the same Department of Treasury on US citizens having financial interests overseas. It seemed likely the OP might now have a financial interest overseas, say a Thai bank account, as he lives and works in Thailand. It also seemed from the nature of the OP's question that it might be the first time he has lived or worked overseas and therefore he might be unaware of this other obligation, which is more likely to affect expats than those who live and work inside the US.

It's a good thing to make clear that the FBAR is filed separately from the tax return, and there are different filing requirements, including different deadlines for filing. It is possible that a particular person could be required to file one or the other, both, or neither, depending on their individual circumstances.

Just a heads up to the OP, since the penalties for failing to file an FBAR (if required to do so) are worse than tax penalties. Given the draconian penalties associated with non-filing of the FBAR I thought it might be a forgivable breach of etiquette to stray off the topic and mention it.

Not applicable to the OP

I made a few thousand dollars teaching.

[skatewash]

True but that is a separate matter from IRS requirements.

Sent from my Lenovo S820_ROW using Thaivisa Connect Thailand mobile app

Based on the fact that the OP was inquiring about his obligations to the IRS based on being a US citizen living overseas, I thought it might perhaps be a good idea to mention another obligation imposed by the same Department of Treasury on US citizens having financial interests overseas. It seemed likely the OP might now have a financial interest overseas, say a Thai bank account, as he lives and works in Thailand. It also seemed from the nature of the OP's question that it might be the first time he has lived or worked overseas and therefore he might be unaware of this other obligation, which is more likely to affect expats than those who live and work inside the US.

It's a good thing to make clear that the FBAR is filed separately from the tax return, and there are different filing requirements, including different deadlines for filing. It is possible that a particular person could be required to file one or the other, both, or neither, depending on their individual circumstances.

Just a heads up to the OP, since the penalties for failing to file an FBAR (if required to do so) are worse than tax penalties. Given the draconian penalties associated with non-filing of the FBAR I thought it might be a forgivable breach of etiquette to stray off the topic and mention it.

Not applicable to the OP

I made a few thousand dollars teaching.

Don't see how you could possibly know that. The fact that the OP only had a very small income has no bearing on whether he has foreign financial accounts. In fact, one might think that it makes it more likely he is living on savings, possibly held in a Thai bank account, since it's not likely he is living entirely on a few thousand dollars earned teaching. Of course, the OP could have no foreign financial accounts, or be under the threshold reporting requirements, but I can't see how you could possibly know that. The OP is probably in a better position to make that determination.

[Pib]

Well, hopefully the OP went to that IRS webpage to run the tax filing numbers and will give us some feedback....or not.

[AjarnKim14]

Thanks, everyone. I got the information I needed and appreciate the discussion. And, no, I don't have any Thai accounts with more than my single month paycheck that went right back to covering expenses. Thank you for the information on the amounts. I don't have money for an accountant, but appreciate the information about it possibly being helpful financially in the future. I'll also check the link. Much appreciated.

[TallGuyJohninBKK]

For me, the OP's post raised the following question:

If he (or she) made a few thousand dollars in income from teaching jobs last year, that alone typically wouldn't be sufficient for a person to support themselves, living in the U.S. or Thailand. So that kind of raises the question, is there some other income coming into the picture somewhere that isn't being mentioned in the post?

I say that because, as most Americans know, ALL income (salary, interest income, dividends, etc.) received by American citizens worldwide from any sources is potentially taxable income under U.S. law -- subject to deductions, credits, etc. and of course some income sources being tax free like Roth IRA distributions and such.

Perhaps the OP has a generous benefactor or is able to lead an extraordinarily frugal lifestyle.

[taxout]

There's another test for filing a 1040 not mentioned above: income from self-employment:

"You have to file an income tax return if your net earnings from self-employment were $400 or more."

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center

This filing requirement exists because you have to pay Social Security tax on earnings from self-employment outside the U.S. (though not on wages earned as an employee outside the U.S., provided your employer isn't a "U.S. person" as defined for this purpose).

It's pretty easy to reach that amount by doing, say, some private tutoring. It's also possible to be working for a school as an independent contractor, not as an employee, depending on contract conditions, in which case you'd also be considered self-employed. Sometimes the distinction between a self-employed independent contractor and an employee can be difficult.

[BKKSnowBird]

There's another test for filing a 1040 not mentioned above: income from self-employment:

"You have to file an income tax return if your net earnings from self-employment were $400 or more."

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center

This filing requirement exists because you have to pay Social Security tax on earnings from self-employment outside the U.S. (though not on wages earned as an employee outside the U.S., provided your employer isn't a "U.S. person" as defined for this purpose).

It's pretty easy to reach that amount by doing, say, some private tutoring. It's also possible to be working for a school as an independent contractor, not as an employee, depending on contract conditions, in which case you'd also be considered self-employed. Sometimes the distinction between a self-employed independent contractor and an employee can be difficult.

That is a good point. I was always an employee but I bet many don't report there side jobs as self employment.

I also earned about 10k teaching one year. Many said no need to file. I filed and used 2555ez to be on the safe side. If you don't file, you will never run the 3 years of a possible audit.

[Pib]

There's another test for filing a 1040 not mentioned above: income from self-employment:

"You have to file an income tax return if your net earnings from self-employment were $400 or more."

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Self-Employed-Individuals-Tax-Center

This filing requirement exists because you have to pay Social Security tax on earnings from self-employment outside the U.S. (though not on wages earned as an employee outside the U.S., provided your employer isn't a "U.S. person" as defined for this purpose).

It's pretty easy to reach that amount by doing, say, some private tutoring. It's also possible to be working for a school as an independent contractor, not as an employee, depending on contract conditions, in which case you'd also be considered self-employed. Sometimes the distinction between a self-employed independent contractor and an employee can be difficult.

That is a good point. I was always an employee but I bet many don't report there side jobs as self employment.

I also earned about 10k teaching one year. Many said no need to file. I filed and used 2555ez to be on the safe side. If you don't file, you will never run the 3 years of a possible audit.

Sure enough...I used the IRS webpage I gave in my first post above as a single person making $10K and whether I selected employed or self employed regarding where social security paid, the answer was I needed to file. Basically if social security taxes were not withheld you need to file.

[NancyL]

Is income averaging still an option? I remember when I first graduated from university and started to work, it was to my advantage to do five-year income averaging for a couple years because my income suddenly went from very low levels to a fairly good level. It helped that I'd been filing tax returns even when my income was very small.

Oops -- just did a Google search and see that income averaging was repealed in 1986. Guess I'm showing my age.

Still the point is that there may be some advantages to filing and some tax credits that the OP could be able to obtain.

[Pib]

This short Forbes article does a good job of summarizing if a person must file, to include those reasons besides the basic minimum income requirement. Obviously making less than $10,150 in 2014 does not necessary mean a person is not required to file a tax return....other reasons exist like if making at least $400 as a self employed person, uncollected social security taxes, etc.

http://www.forbes.com/sites/kellyphillipserb/2015/01/12/do-you-have-to-file-a-tax-return-in-2015/

[JimGant]

Hard to tell if the OP is talking about filing a Thai tax return, or a US tax return...or maybe both...

I was at three jobs in Thailand in 2014 and I made a few thousand dollars teaching. One paid by check, one paid in cash and one paid by bank deposit.

Was there any Thai tax withholding done?

I made so little. Is it possible I could be getting a refund if I file.

If the answer to the first question is "yes," then based on your paltry income, you should owe no Thai tax -- and amounts withheld are refundable.

Are US citizens living in Thailand and making under a certain amount exempt from taxes?

Maybe he's read about the US-Thai tax treaty...... But its only applicability in his situation is that double taxation can be avoided. But being a US citizen, or one from Anywhere, doesn't preclude Thailand's right to tax all income earned in Thailand from Thai employers. No treaty, to my knowledge, exempts that fact.

[IMA_FARANG]

You should not file. There is no reason to; even the IRS doesn't want your W4 if your income is less than 10 grand.

It is NOT true that as a U.S. citizen you do not have to file a U.S tax return if you make less that a certain amount of income for that year.

All U.S. citizens need to file a tax return no matter what their income is........ you must file a return..... but you may not need to pay any tax if your income is under the minimum requirement..... or if you can legally claim exemptions on your income which would bring it under the minimum income.

However, you still need to file a return..... and you can be fined for deliberately not filing a return.

If you file from an address outside the U.S. the filing date may be extended form April 15th to June 15th due to filing from overseas.

Incidentally unlike many other countries, a person, no matter what his or her nationality, is required to file a tax return on any income they earned in the U.S or from a U.S source.

There may be tax agreements with some countries that allow you to write off tax paid in a foreign country on income earned in a foreign country and offset that income on your U.S. tax liability.... Thailand has such an tax agreement with the U.S.

So if you earned income in Thailand and can show proof you paid Thai tax on that income you MAY be able to write off (offset) tax liability on that income in the U.S.

But U.S. tax laws get complicated quickly, and I am NOT an expert.

Edited April 17, 2015 by IMA_FARANG

[skatewash]

You should not file. There is no reason to; even the IRS doesn't want your W4 if your income is less than 10 grand.

It is NOT true that as a U.S. citizen you do not have to file a U.S tax return if you make less that a certain amount of income for that year.

All U.S. citizens need to file a tax return no matter what their income is........ you must file a return..... but you may not need to pay any tax if your income is under the minimum requirement..... or if you can legally claim exemptions on your income which would bring it under the minimum income.

However, you still need to file a return..... and you can be fined for deliberately not filing a return.

...

But U.S. tax laws get complicated quickly, and I am NOT an expert.

According to the IRS, a US citizen only needs to file a US tax return if he meets the requirements for doing so. Even if a US citizen is not required to do so there are reasons that a citizen may want to file a return anyway (see Forbes article posted above by Pib for reasons why).

If every US citizen had to file a US tax return, then the IRS would probably not bother publishing the following on their website: http://www.irs.gov/uac/Do-I-Need-to-File-a-Tax-Return%3F

[Jingthing]

Definitely it is not true that all are required to file. Follow the rules on the IRS site. Sorted.

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[Pib]

Yeap, quite common for low income, retired folks living on only a low social security pension to not be required to file a tax return. In fact, I just used above IRS website to see if a single retired person under 65 living on say $10,149 worth of social security pension would be required...after answering the various questions asked in the IRS interview like was there any other income earned like interest, dividends, etc., the answer is below.

See Below...Single Retired Person Living Off an Annual Income of $10,149....answer was "no tax return required"

See Below....Retired Person Living Off an Annual Income of $10,150....answer was "tax return was required"

And I expect if I had ran it more times with different conditions like being married, over 65, etc.,using income levels based on below table from the TurboTax website I would have once again told me no income tax form was required. But keep in mind whether you need to file an tax return or not is not purely based on total income earned as there are some other conditions that may trigger the need for an income tax return. Just use the IRS webpage "Do I need to file an income tax return"...it only takes 5 minutes...and the IRS is indeed an expert on whether you need to file or not.