willocraig

Hi All! - Im in need of some advice.

I moved to the US from the UK in June 2012 and found out that as I've spent more the 183 days of the year in the States, I fall into the 'Dual-Status' category.

I have NO idea what I'm doing with taxes so I'm struggling quite a bit.

I contacted an international tax attorney today and they told me they can help me with this but their fee is $425 per hour!! and I would need a few hours just to get started. Is this normal???

Is there anyone else who has been in the same position and could advise a cheaper way of doing this? or am I going to have to just bite the bullet and pay through the nose!!

Any help would be greatly appreciated!

Thanks in advance,
Philip

willocraig

BTW, I live in Maryland.

Bob

So you didn't negotiate this as part of your relocation package? It's a pretty common ask, but that boat has probably sailed.

There are plenty of threads on BE, with loads of advice, so well worth having a search to see what other people have been recommended.

There's a chap that gets recommended a lot on BE, but he's not taking on new clients at the moment, but you might find other recommendations to Pete Newton.

Jerseygirl

Probably worth getting an accountant who is experienced with UK/US taxes to do your taxes for at least the first year. Our accountant's bill is into 4 figures each year...but our taxes are not straightforward.

Some on here use Turbotax and some use the dreaded H&R Block. Still think it's best to get the first year's done by an experienced accountant.

notonuksoil

Our accountant charges $500 in total and files on our behalf, this year she has found us just over $2k that we hadn't accounted for ourselves so worth every cent! Just waiting for one form to be released so we can file at the end of this week.

We have property in the UK that we rent out which makes it slightly more difficult when using turbo tax which is why we use an accountant.

HarryTheSpider

I too came over on L1B but didn't end up dual-status - the first year taxes can be daunting, and I'm happy to share specifics in a PM if you wish. You can offset taxes paid in the UK against overall tax bill for the year, but it's not a straight forward 'subtract one from the other', only the amount of tax you would have paid if you'd been in the US the whole year, and typically that's at a lower tax rate. There is some formula involved but I don't know what it is... worth googling perhaps... Any left over unclaimed tax can be carried forward to next year. Best advice is find a good tax accountant - my tax prep bill for 2012 taxes was under $600. You'll likely soon get some good recommendations soon.

Don't answer these publicly here, but consider the following questions and research these on the internet in the US context. This may lead you to more specific questions that might get a steer here in future or help you select the right level of service from a tax accountant...

Do you have a home in the UK, and is it rented out or not?
Are you married?
Do you have kids?
Do you have additional sources of income, such as shares dividends, pension, business interests etc? In the UK? In the US?
Did you buy/sell any shares last year? Were these when you were still in the UK, or all in the US, or a mix?
Did you have foreign bank & financial accounts exceeded $10k in aggregate at any time during 2012? Did you have joint foreign financial assets (including pensions, excluding real estate) exceeded $100k in aggregate at any time during 2012?

The fewer of these things you have going on, the less complex (& expensive) your taxes will likely be. And you can offset any expenses you paid in coming to the US for your job against your tax bill, I believe...

The usual US_centric disclaimer applies - none of the above is to be construed as advice of any kind. What you do with it is entirely up to you etc etc etc. I can only really tell you what I did, what questions I had to contend with etc.

Any way, good luck...

notonuksoil

This is correct you can offset the relocation experiences, flights shipping etc. You are also able to offset against flight costs relating to your UK property if you have to go back and over see any work that is carried out

Steve_

Read IRS publication 519, there is an example in there. It's not that difficult to do it yourself. $425 an hour is idiotically expensive, my accountant charges $100 an hour and specializes in this sort of thing.

Dual-status tax returns really aren't that hard if you didn't have any US-source income for the first part of the year, essentially it is a pro-rated 1040 for the part of the year you were in the US.

http://www.irs.gov/pub/irs-pdf/p519.pdf

Read part 6.