OT: Taxes, Foreign Income Exclusion
Apr 8th 2003, 10:20 pm
#1
Forum Regular
Thread Starter
Joined: Nov 2002
Posts: 47
OT: Taxes, Foreign Income Exclusion
Hi,
does anyone have experience with form 2555?
I am trying to figure out if I meet the Bona Fide Residence Test, or the Physical Presence Test to file Foreign Income Exclusion.
1) For Physical Presence, as far as I understand it is necessary to have been in you home country for 330 days in any 12 month period.
I was in the USA from January to March 2002, and June to December 2002, so I will never be able to meet that test, right?
2) For Bona Fide Residence you have to be Bona Fide resident of the foreign country for the last year.
I am German citizen and I had my appartment & business there for the whole year 2002.
Does that make me a Bony Fide resident?
Can a citizen of a foreign country be Bona Fide Resident the same time?
Thx in advance
JuMu
does anyone have experience with form 2555?
I am trying to figure out if I meet the Bona Fide Residence Test, or the Physical Presence Test to file Foreign Income Exclusion.
1) For Physical Presence, as far as I understand it is necessary to have been in you home country for 330 days in any 12 month period.
I was in the USA from January to March 2002, and June to December 2002, so I will never be able to meet that test, right?
2) For Bona Fide Residence you have to be Bona Fide resident of the foreign country for the last year.
I am German citizen and I had my appartment & business there for the whole year 2002.
Does that make me a Bony Fide resident?
Can a citizen of a foreign country be Bona Fide Resident the same time?
Thx in advance
JuMu
Apr 9th 2003, 4:36 am
#2
Forum Regular
Thread Starter
Joined: Nov 2002
Posts: 47
Please, any answers?
(begging)
(begging)
Apr 9th 2003, 8:13 pm
#3
Guest
Posts: n/a
Re: OT: Taxes, Foreign Income Exclusion
Hello there,
When we filed our married joint taxes, our accountant after checking with the
IRS, and the IRS helpline that I called myself,
both said that You basically 'choose' to be classed as resident in the US for
that year for tax purposes (am assuming you are married to a US citizen). You
file the 1030 and also the 2555 in addition.
Your income earned over seas, if it has already been taxed there, can come
under the foreign income exclusion if it is under the $80,000 threshold. This
you will put on the 2555 form.
I am only speaking from personal experience and am not giving legal advice.
I would suggest it is well worth it if you are that confused, to get an
accountant to file for you . It cost us a fair old bit in fees, but we got a
terrific return which more than paid the extra.
Good luck,
Jacqueline H
When we filed our married joint taxes, our accountant after checking with the
IRS, and the IRS helpline that I called myself,
both said that You basically 'choose' to be classed as resident in the US for
that year for tax purposes (am assuming you are married to a US citizen). You
file the 1030 and also the 2555 in addition.
Your income earned over seas, if it has already been taxed there, can come
under the foreign income exclusion if it is under the $80,000 threshold. This
you will put on the 2555 form.
I am only speaking from personal experience and am not giving legal advice.
I would suggest it is well worth it if you are that confused, to get an
accountant to file for you . It cost us a fair old bit in fees, but we got a
terrific return which more than paid the extra.
Good luck,
Jacqueline H
Apr 9th 2003, 8:46 pm
#4
unDAUNTEd
Joined: Dec 2002
Location: Minnesota, USA
Posts: 256
Re: OT: Taxes, Foreign Income Exclusion
Originally posted by JuMu
Hi,
does anyone have experience with form 2555?
I am trying to figure out if I meet the Bona Fide Residence Test, or the Physical Presence Test to file Foreign Income Exclusion.
1) For Physical Presence, as far as I understand it is necessary to have been in you home country for 330 days in any 12 month period.
I was in the USA from January to March 2002, and June to December 2002, so I will never be able to meet that test, right?
2) For Bona Fide Residence you have to be Bona Fide resident of the foreign country for the last year.
I am German citizen and I had my appartment & business there for the whole year 2002.
Does that make me a Bony Fide resident?
Can a citizen of a foreign country be Bona Fide Resident the same time?
Thx in advance
JuMu
Hi,
does anyone have experience with form 2555?
I am trying to figure out if I meet the Bona Fide Residence Test, or the Physical Presence Test to file Foreign Income Exclusion.
1) For Physical Presence, as far as I understand it is necessary to have been in you home country for 330 days in any 12 month period.
I was in the USA from January to March 2002, and June to December 2002, so I will never be able to meet that test, right?
2) For Bona Fide Residence you have to be Bona Fide resident of the foreign country for the last year.
I am German citizen and I had my appartment & business there for the whole year 2002.
Does that make me a Bony Fide resident?
Can a citizen of a foreign country be Bona Fide Resident the same time?
Thx in advance
JuMu
My experiences are exactly like Jacqueline's. Like she said, I would get a professional tax preparer to help you out if you are as throughly confused as I was.
I was lucky to have a friend that did ours for free (*thank you Troy*), but the same thing happened...my husband opted to be treated as a resident and we filed the exclusion. Our tax guy called the IRS helpline whilst we were there in his office and they walked him through it.
Good luck!
Angela
Apr 9th 2003, 9:28 pm
#5
Forum Regular
Thread Starter
Joined: Nov 2002
Posts: 47
Re: OT: Taxes, Foreign Income Exclusion
Thank you for your answers.
We have a so called 'professional' to do the thing.
I'm just not sure if he knows what he is doing.
Initially they came up with a tax credit form.
After a few days they called and told they would need some more information, because they were doing it differently now (form 2555).
But still they havent asked for the exact times / number of days I spent in Germany, which is as far as I understand an important factor.
I just have a bad feeling about this whole thing and was hoping to get some information on here.
Thanks
JuMu
We have a so called 'professional' to do the thing.
I'm just not sure if he knows what he is doing.
Initially they came up with a tax credit form.
After a few days they called and told they would need some more information, because they were doing it differently now (form 2555).
But still they havent asked for the exact times / number of days I spent in Germany, which is as far as I understand an important factor.
I just have a bad feeling about this whole thing and was hoping to get some information on here.
Thanks
JuMu
Apr 9th 2003, 11:23 pm
#6
Concierge
Joined: Apr 2001
Posts: 46,382
Re: OT: Taxes, Foreign Income Exclusion
have you tried looking in the FAQ's link to the Mysterious Brown Envelope. The webmaster has a piece on how he and his wife did it for the first year. Quite detailed and informative.
Rete
Rete
Originally posted by JuMu
Thank you for your answers.
We have a so called 'professional' to do the thing.
I'm just not sure if he knows what he is doing.
Initially they came up with a tax credit form.
After a few days they called and told they would need some more information, because they were doing it differently now (form 2555).
But still they havent asked for the exact times / number of days I spent in Germany, which is as far as I understand an important factor.
I just have a bad feeling about this whole thing and was hoping to get some information on here.
Thanks
JuMu
Thank you for your answers.
We have a so called 'professional' to do the thing.
I'm just not sure if he knows what he is doing.
Initially they came up with a tax credit form.
After a few days they called and told they would need some more information, because they were doing it differently now (form 2555).
But still they havent asked for the exact times / number of days I spent in Germany, which is as far as I understand an important factor.
I just have a bad feeling about this whole thing and was hoping to get some information on here.
Thanks
JuMu
Apr 10th 2003, 3:51 am
#7
Forum Regular
Thread Starter
Joined: Nov 2002
Posts: 47
Re: OT: Taxes, Foreign Income Exclusion
Originally posted by Rete
have you tried looking in the FAQ's link to the Mysterious Brown Envelope. The webmaster has a piece on how he and his wife did it for the first year. Quite detailed and informative.
Rete
have you tried looking in the FAQ's link to the Mysterious Brown Envelope. The webmaster has a piece on how he and his wife did it for the first year. Quite detailed and informative.
Rete
I have read the IRS page concerning the 2 Bona Fide Resident Test and Physical Residence Test aswell.
Unfortunately so far I couldnt find any example, that matches my particular situation.
That means not having lived 330 days in a 12 month period in the foreign country, but being a (tax-paying) citizen/resident of that country.
I don't understand what 'Bona Fide' in this case means.
JuMu
Apr 10th 2003, 2:17 pm
#8
Guest
Posts: n/a
Re: OT: Taxes, Foreign Income Exclusion
From Webster's:
1 : made in good faith without fraud or deceit
2 : made with earnest intent : SINCERE
3 : neither specious nor counterfeit : GENUINE
synonym see AUTHENTIC
"JuMu" wrote in message
news:[email protected]...
> Originally posted by Rete
> > have you tried looking in the FAQ's link to the Mysterious Brown
> > Envelope. The webmaster has a piece on how he and his wife did it for
> > the first year. Quite detailed and informative.
> >
> > Rete
> Yes, that was one of my sources.
> I have read the IRS page concerning the 2 Bona Fide Resident Test and
> Physical Residence Test aswell.
> Unfortunately so far I couldnt find any example, that matches my
> particular situation.
> That means not having lived 330 days in a 12 month period in the foreign
> country, but being a (tax-paying) citizen/resident of that country.
> I don't understand what 'Bona Fide' in this case means.
> JuMu
> --
> Posted via http://britishexpats.com
1 : made in good faith without fraud or deceit
2 : made with earnest intent : SINCERE
3 : neither specious nor counterfeit : GENUINE
synonym see AUTHENTIC
"JuMu" wrote in message
news:[email protected]...
> Originally posted by Rete
> > have you tried looking in the FAQ's link to the Mysterious Brown
> > Envelope. The webmaster has a piece on how he and his wife did it for
> > the first year. Quite detailed and informative.
> >
> > Rete
> Yes, that was one of my sources.
> I have read the IRS page concerning the 2 Bona Fide Resident Test and
> Physical Residence Test aswell.
> Unfortunately so far I couldnt find any example, that matches my
> particular situation.
> That means not having lived 330 days in a 12 month period in the foreign
> country, but being a (tax-paying) citizen/resident of that country.
> I don't understand what 'Bona Fide' in this case means.
> JuMu
> --
> Posted via http://britishexpats.com
