Do USA citizen need to pay tax in Thailand?

[TallGuyJohninBKK]

Or you could do what I do..

TELL THEM NOTHING.......

And end up risking losing your U.S. passport if you accrue too much in unpaid taxes, and the U.S. government eventually finds out:

More ominously, the IRS and the State Department are also implementing a provision approved by Congress in December that could revoke the passports of Americans who owe too much–raising the prospect of being stranded abroad on account of poor arithmetic.

..................

The new passport-revocation rule, slipped into a transportation funding bill signed by President Barack Obama, raises the stakes. It allows the U.S. to revoke the passport of any American whose tax debt exceeds $50,000.

It’s not hard to see how expatriate taxpayers could get to this level, especially if they’re late in realizing they needed to file in the first place. The fines for failing to report bank accounts are high; the IRS can impose a penalty of $10,000 for each violation of the rules. “If the government enforces this in the most stringent way possible, this could be hugely horrible for people who live overseas,” McKeegan said.

Last month, members of Congress urged the State Department to “consider the unique circumstances of overseas Americans” before revoking anyone’s passport. An IRS spokesperson declined to comment on the passport rule or other specific taxpayer concerns.

http://www.bloomberg.com/news/articles/2016-03-30/owe-back-taxes-lose-your-passport

Edited June 18, 2016 by TallGuyJohninBKK

[ThaiTony2]

Even if you earned income, if it falls below the IRS minimum you don't have to file a tax return. The minimum varies according to your age and filing status -- whether you are single, head of household, filing jointly with your spouse or you can be claimed as a dependent on someone else's taxes.

[Mansell]

Even if you earned income, if it falls below the IRS minimum you don't have to file a tax return. The minimum varies according to your age and filing status -- whether you are single, head of household, filing jointly with your spouse or you can be claimed as a dependent on someone else's taxes.

I don't think you are correct here....the reality is even if you owe zero in taxes, you still have to file a return each year. Now you can ignore this and the $10,000 or more in the bank.....but they can come after you whether it is holding back from your Social Security payments, or canceling your passport.

I remember years ago the guy who said he didn't have to pay taxes because it was against the Constitution being unlawful taxation. I went to one of his seminars and everybody who entered the place was being photographed.....by who? I do not know. Eventually this individual was put on trial and ended up in Federal Prison for quite a number of years. Then there was the actor Wesley Snipes who does action movies who didn't think he should pay his taxes.....more prison time.

Moral of the stories....don't try to fight Uncle Sam as he has more resources than you do and longer arms and probably faster legs.

[returnofthailand]

just saw today on Fox news that a poor lady has been seized 30k dollars from the IRS for non reporting account through FBAR protocol. and a guy has been seized 200k.

they say it s not right as they didn't commit any crime. not declaring an account is not a crime for the DOJ. seems to me IRS is making their own justice.

(suing the IRS would cost too much and they don't have the cash)

it s nice to be a EU citizen. I have several account in different countries. so all these rules don't apply to me (for now)

the truth is I don't really care about tax. if I don't receive anything by mail, I do nothing. I make my money through investment mainly stocks and bonds.

Edited June 18, 2016 by returnofthailand

[soc]

I m taxed based on residence, and not on citizenship. this is why I mention I m a EU resident.

all money I make is from Europe mainly, and as I m a tourist here with a tourist visa in Thailand and never stay longer than 3 months consecutively, I don't have to report anything. it s like I m living on the moon or in international waters. that s the nice thing to tax on residence Vs citizenship.

I heard USA is the only country with etria who tax on citizenship. maybe these 2 countries should unite together and make one flag for both (sarcasm).

my life is sweet. this is years I have not filed any tax report and the money is still raining on my account.

l laughed out loud at "the money raining on your account".

Don't we all wish for that!

[soc]

After the Brits kicked themselves out due to overzealous collection of taxes in the new world, the now Yanks have gone one step further in making their citizens pay tax on worldwide income... that's why lots come here and hide.

Apparently Boris Johnson is being chased by the IRS for taxes earned overseas because he was born in the States.

The US has been taxing their citizens for a long time I was required to file US taxes in Japan in 1965 and have been doing it ever sense I have lived in Asia and the middle east.Living here in retirement A US citizen is still required by law to file a tax report every year.Money made outside the US is tax free to $95,000.00.but you still have to file.

And yet, as a non US citizen, when l worked in America in 2007, l paid no tax at all.

True, the rate per hour was much lower than my American co-workers, but l still paid no tax.

The low hourly rate didn't bother me as l was on paid leave from my Australian job & my US employer also provided food & accommodation.

[JimGant]

I am not a resident of Europe, I m a EU citizen making me off radar for income tax in Europe as I don't reside in Europe.

how does it work for Americans? . if you make some money in the USA and you live in Thailand, can you avoid pay tax at all. (legally) like me.

Nah. You see, for most of us Yank expat retirees, our income is largely based on US based income -- like my Air Force retirement check, Social Security, payouts from my 'tax deferred' IRAs and 401ks, and investment income from mostly US based investments. The US tax I pay while living here in Thailand is identical to what I'd pay if I lived in the US. So, I've no heart burn over the fact that Uncle wants his cut from what, for me anyway, are checks being payed with US taxpayer dollars. To all of a sudden not be one of those "US taxpayers" contributing to my Federally derived payouts -- because I parked my bod in some foreign beach resort -- somehow doesn't resonate.

So, no, we can't legally avoid paying taxes on this retirement income. That some from Europe can -- is interesting. Even more interesting is that, the taxpayers who stay home and have to pay the shortfall from the expats -- aren't more vocal. Best watch out your millennial population doesn't catch on to this screw job.

[aronp1]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

[TallGuyJohninBKK]

Meanwhile, hot off the presses from the IRS:

Don’t Forget to Report Certain Foreign Accounts to Treasury by the June 30 Deadline

IR-2016-90, June 17, 2016

WASHINGTON — The Internal Revenue Service today reminded taxpayers who have one or more bank or financial accounts located outside the United States, or signature authority over such accounts that they may need to file an FBAR by Thursday, June 30.

By law, many U.S. taxpayers with foreign accounts exceeding certain thresholds must file Form 114, Report of Foreign Bank and Financial Accounts, known as the "FBAR." It is filed electronically with the Treasury Department's Financial Crimes Enforcement Network (FinCen).

"Robust growth in FBAR filings in recent years shows we are getting the word out regarding the importance of offshore tax compliance," said IRS Commissioner John Koskinen. "Taxpayers here and abroad should take their foreign account reporting obligations very seriously.”

In general, the filing requirement applies to anyone who had an interest in, or signature or other authority over foreign financial accounts whose aggregate value exceeded $10,000 at any time during 2015. Because of this threshold, the IRS encourages taxpayers with foreign assets, even relatively small ones, to check if this filing requirement applies to them. The form is only available through the BSA E-Filing System website.

In 2015, FinCen received a record high 1,163,229 FBARs, up more than 8 percent from the prior year. FBAR filings have grown on average by 17 percent per year during the last five years, according to FinCen data.

The IRS is implementing the Foreign Account Tax Compliance Act (FATCA), which mandates third-party reporting of foreign accounts to foster offshore tax compliance. FATCA created a new filing requirement: IRS Form 8938, Statement of Specified Foreign Financial Assets, which is filed with individual tax returns. The filing thresholds are much higher for this form than for the FBAR.

The International Taxpayers page on IRS.gov provides the best starting place to get answers to important questions. The website has a directory that includes overseas tax preparers. International taxpayers will find the online IRS Tax Map and the International Tax Topic Index to be valuable resources.

Edited June 18, 2016 by TallGuyJohninBKK

[TallGuyJohninBKK]

Even if you earned income, if it falls below the IRS minimum you don't have to file a tax return. The minimum varies according to your age and filing status -- whether you are single, head of household, filing jointly with your spouse or you can be claimed as a dependent on someone else's taxes.

Here are the federal income tax return filing thresholds/triggers that applied for the 2015 tax year. Probably will be a bit higher for the upcoming 2016 tax year.

[aronp1]

Meanwhile, hot off the presses from the IRS:

Don’t Forget to Report Certain Foreign Accounts to Treasury by the June 30 Deadline

IR-2016-90, June 17, 2016

WASHINGTON — The Internal Revenue Service today reminded taxpayers who have one or more bank or financial accounts located outside the United States, or signature authority over such accounts that they may need to file an FBAR by Thursday, June 30.

By law, many U.S. taxpayers with foreign accounts exceeding certain thresholds must file Form 114, Report of Foreign Bank and Financial Accounts, known as the "FBAR." It is filed electronically with the Treasury Department's Financial Crimes Enforcement Network (FinCen).

"Robust growth in FBAR filings in recent years shows we are getting the word out regarding the importance of offshore tax compliance," said IRS Commissioner John Koskinen. "Taxpayers here and abroad should take their foreign account reporting obligations very seriously.”

In general, the filing requirement applies to anyone who had an interest in, or signature or other authority over foreign financial accounts whose aggregate value exceeded $10,000 at any time during 2015. Because of this threshold, the IRS encourages taxpayers with foreign assets, even relatively small ones, to check if this filing requirement applies to them. The form is only available through the BSA E-Filing System website.

In 2015, FinCen received a record high 1,163,229 FBARs, up more than 8 percent from the prior year. FBAR filings have grown on average by 17 percent per year during the last five years, according to FinCen data.

The IRS is implementing the Foreign Account Tax Compliance Act (FATCA), which mandates third-party reporting of foreign accounts to foster offshore tax compliance. FATCA created a new filing requirement: IRS Form 8938, Statement of Specified Foreign Financial Assets, which is filed with individual tax returns. The filing thresholds are much higher for this form than for the FBAR.

The International Taxpayers page on IRS.gov provides the best starting place to get answers to important questions. The website has a directory that includes overseas tax preparers. International taxpayers will find the online IRS Tax Map and the International Tax Topic Index to be valuable resources.

And people who know nothing about America think it's so great! America is the best! Yes you're right about that. The best at scamming people out of money, the truth, and their health.

[TallGuyJohninBKK]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

With that kind of wrong advice, good luck in your future meeting with the IRS.

[TallGuyJohninBKK]

Even if you earned income, if it falls below the IRS minimum you don't have to file a tax return. The minimum varies according to your age and filing status -- whether you are single, head of household, filing jointly with your spouse or you can be claimed as a dependent on someone else's taxes.

I don't think you are correct here....the reality is even if you owe zero in taxes, you still have to file a return each year. Now you can ignore this and the $10,000 or more in the bank.....but they can come after you whether it is holding back from your Social Security payments, or canceling your passport.

You're both right in a way.

ThaiTony is right that the requirement to file an annual federal tax return does have gross income triggers, as in those in the chart I posted above. If you'd under those triggers, you don't have to file.

Mansell is right in that it's not how much taxes you owe (or don't owe) that triggers your filing requirement. Even if you owe no taxes but are above the gross income triggers, you still have to file.

[aronp1]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

With that kind of wrong advice, good luck in your future meeting with the IRS.

That's the way it has always been. When earning less than 60,000 a year you actually get a return. When in Iraq talking with employees of KBR that were making 125,000 a year, they informed me the first 80,000 is not taxable. Also my pay in the Army was none taxable. So I'm sure if I had to "pay" anything to the IRS for any of the many years filing taxes, they would have told me and not send me a return.

[Pib]

I think you will find many, many, many people making less that $60K per year who are paying taxes. And those KBR employees in Iraq were probably able to use the foreign income exclusion already talking about in this thread. And lord knows I spent several decades in the Air Force and my pay was always taxable, although you could get some exclusions for service in war zones for active duty and civil service...maybe contractors to.

But your general statement of "If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable" is just flat out wrong. And I'm sure many ThaiVisa members living & retired in Thailand with income of less than $60K (or $80K) will confirm that for you. Let me be one of the first to confirm.

Edited June 19, 2016 by Pib

[aronp1]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

Where in the world and in what condition did you get (and believe) this info?

from the IRS and personal experience. Edited June 19, 2016 by aronp1

[Pib]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

Where in the world and in what condition did you get (and believe) this info?

from the IRS and personal experience.

Just give me a few IRS link please?

[Pib]

Some info on combat zone tax exemptions for civilians and active duty.

https://www.irs.gov/uac/questions-answers-on-combat-zone-tax-provisions

http://www.military.com/benefits/military-pay/special-pay/combat-zone-tax-exclusions.html

[aronp1]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

Where in the world and in what condition did you get (and believe) this info?

from the IRS and personal experience.

Just give me a few IRS link please?

look it up yourself. I think people are getting things mixed up here. First of all everybody pays an income tax , that is taken out of every paycheck. What I'm talking about is at the end of the year the IRS telling you that you owe them money. I have never filed taxes and the IRS told me I had to pay them money. I forgot to file my 2014 taxes in 2015, I just did that this year. 2014 was my last year 8n the US. I had a driving job made 45,000 + , I just got my return for 1,280.00.

[beachproperty]

If you make less than $60,000 a year you don't pay taxes. If you live outside the US, $80,000 and below is none taxable.

Where in the world and in what condition did you get (and believe) this info?

from the IRS and personal experience.

Just give me a few IRS link please?

Just chalk it up to, that aronp1 doesn't know anything.

Edited June 19, 2016 by beachproperty

[TallGuyJohninBKK]

look it up yourself. I think people are getting things mixed up here. First of all everybody pays an income tax , that is taken out of every paycheck. What I'm talking about is at the end of the year the IRS telling you that you owe them money. I have never filed taxes and the IRS told me I had to pay them money.

I forgot to file my 2014 taxes in 2015, I just did that this year. 2014 was my last year 8n the US. I had a driving job made 45,000 + , I just got my return for 1,280.00.

As others have already told you, what you actually wrote in your prior post was simply wrong, and should be disregarded.

But what you actually apparently meant you took another crack at here in this post.

And yes, it's true that ANYONE of any income can avoid OWING the IRS money at the end of the year -- if you elect to have sufficient withholding from your income during the year to cover your tax obligation. That's not the same as not owing taxes on income up to some certain amounts. You still owe the tax, you're just paying it during the year instead of at year-end.

[Pib]

look it up yourself. I think people are getting things mixed up here. First of all everybody pays an income tax , that is taken out of every paycheck. What I'm talking about is at the end of the year the IRS telling you that you owe them money. I have never filed taxes and the IRS told me I had to pay them money. I forgot to file my 2014 taxes in 2015, I just did that this year. 2014 was my last year 8n the US. I had a driving job made 45,000 + , I just got my return for 1,280.00.

No, need to look it upself, because it don't exist. And I get more confused with your responses, especially where you say, you have never filed taxes...maybe you really just meant for 2014....and maybe you are just getting a refund (a refund does not mean you did not pay some taxes).

And where you say your made $45K and got a return of $1,280, well, what that tells me is the amount of taxes withheld from your pay during the year exceeded what your final tax bill was for the tax year so you got a refund of some of the taxes you paid (the amount overpaid)---but you still paid taxes. The IRS don't send you a refund unless you paid taxes....and that refund amount is just the amount you overpaid.

Your refund sounds like my sister's annual federal refund...she always gets a little over $1,000 refund because she has too much tax withheld form each bi-weekly paycheck. It's like she's giving Uncle Sam an interest free loan during the year....I can not convince her to lower her paycheck withholding amount and just have an allotment going to a saving account to also earn a little interest during the year...she won't do it because she figure she would just spend the money immediately...she prefers to overpay Uncle Sam during the year and then just get a refund each year....and to repeat, she's still paying taxes but she is just getting some of it refunded.

Heck, I've got a refund almost every year of my long U.S. tax filing life, but that is only because for each paycheck during the year I was having more taxes withheld than I ended up owing once filing my tax return. I shoot for a refund of a couple hundred dollars by getting my paycheck withholding real close to paying my tax bill when the dust settles. I still ended up paying thousands of dollars in taxes but I just got the amount I overpaid refunded.

Edited June 19, 2016 by Pib

[returnofthailand]

I should feel guilty now . I don't pay tax at all, not even file... nothing. will I be in trouble?

Edited June 19, 2016 by returnofthailand

[thaihome]

Have worked overseas for 15 years. As long as you work in a country with a higher tax rate then the US, and most are, then you will not pay any US tax. You have to report it all, including any allowances or foreign tax paid for you, but you will not owe any US tax.

The IRS knows this so I was allowed to go exempt and no US tax was ever withheld from my salary

The OP is trolling as usual in order to support his narcissistic superiority complex.

TH

Edited June 19, 2016 by thaihome

[TallGuyJohninBKK]

I should feel guilty now . I don't pay tax at all, not even file... nothing. will I be in trouble?

That depends, on if you're an American who has sufficient income under the IRS rules to require the filing of an annual tax return, as per the chart I posted above.

If you don't, and can still somehow manage to live in Thailand, good for you.

If you do, ask Wesley Snipes how that went (and that was before the IRS gained the legal right last year to revoke U.S. passports over unpaid taxes):

In 2008, Mr. Snipes was convicted of three misdemeanor counts of failing to file tax returns. It was a partial victory for Mr. Snipes and partial defeat for prosecutors, since he defeated the more serious felony counts.

But he got jail time, reporting to McKean Federal Correctional Institution on December 9, 2010. He finished at an adjacent minimum security Club Fed, and was released in April 2013. During 1999 through 2001, Snipes avoided $7 million in taxes. Snipes followed an accountant and an anti-tax advocate down a dangerous path. The advisers claimed they did not legally have to pay taxes.

http://www.forbes.com/sites/robertwood/2015/11/30/wesley-snipes-sues-irs-over-abusive-17-5m-tax-bill-false-promise-of-fresh-start/

Edited June 19, 2016 by TallGuyJohninBKK

[returnofthailand]

I m not a US citizen and I have no residence on earth. I m just a tourist in Thailand. I m a PT.

[vaultdweller0013]

If u pay thai tax on the full income of 200,000 $ at 35 % , its 70,000 . If We Minus it as foreign tax credit from a taxable 92,000 $, its still 22,000 $ income left to be paid the US Tax? Isnt it?

It is a credit, not a deduction, so it is subtracted from the amount owed in taxes, not from the taxable income. It is a non-refundable credit, so if it is more than was owed in tax, it only reduces the amount to $0, unlike the earned income credit, which can actually result in a tax refund if the credit amount is more than is owed in taxes.

There is also a foreign tax deduction that would be subtracted from income instead, but it is rarely used because you need to choose either the credit or deduction (not both), so the credit almost always results in lower taxes.

[sas_cars]

If u pay thai tax on the full income of 200,000 $ at 35 % , its 70,000 . If We Minus it as foreign tax credit from a taxable 92,000 $, its still 22,000 $ income left to be paid the US Tax? Isnt it?

It is a credit, not a deduction, so it is subtracted from the amount owed in taxes, not from the taxable income. It is a non-refundable credit, so if it is more than was owed in tax, it only reduces the amount to $0, unlike the earned income credit, which can actually result in a tax refund if the credit amount is more than is owed in taxes.

There is also a foreign tax deduction that would be subtracted from income instead, but it is rarely used because you need to choose either the credit or deduction (not both), so the credit almost always results in lower taxes.

Thanks. So is there a website to file the tax online? Or is it a complicated process and needs a lawyer to file?

[JLCrab]

I m not a US citizen and I have no residence on earth. I m just a tourist in Thailand. I m a PT.

Yes -- you are just a VIP.

Edited June 19, 2016 by JLCrab

[vaultdweller0013]

If u pay thai tax on the full income of 200,000 $ at 35 % , its 70,000 . If We Minus it as foreign tax credit from a taxable 92,000 $, its still 22,000 $ income left to be paid the US Tax? Isnt it?

It is a credit, not a deduction, so it is subtracted from the amount owed in taxes, not from the taxable income. It is a non-refundable credit, so if it is more than was owed in tax, it only reduces the amount to $0, unlike the earned income credit, which can actually result in a tax refund if the credit amount is more than is owed in taxes.

There is also a foreign tax deduction that would be subtracted from income instead, but it is rarely used because you need to choose either the credit or deduction (not both), so the credit almost always results in lower taxes.

Thanks. So is there a website to file the tax online? Or is it a complicated process and needs a lawyer to file?

There are several software companies that have products that walk you through the tax process and will file electronically. Prices range from free to a couple hundred dollars, The free versions are typically limited in what they can handle and may only be available if your income is below a certain threshold. I'm not sure if the free versions would handle foreign income, as the companies try to push you to more expensive versions if you have any non-typical cases.

Alternatively, you can hire an accountant to fill in the forms and file, or if you are the accountant type, you can fill in the forms directly and file.