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Tax return advice and costs

Tax return advice and costs

Old Jan 16th 2014, 7:54 am
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Default Tax return advice and costs

Hi folks,

It's been a while since my last post (also on tax returns!), but it's that time of year again and I need to start thinking about the 2013 US return.

A bit of background: I was an L1 visa holder employed for 7 months in the US during the 2013 tax year (January 2013 - end of July 2013) with no other income. I returned to the UK at the end of July. My previous tax return for 2012 was for the period of September-December 2012 from the start of my secondment to the end of US financial year.

As such I believe my tax affairs to be relatively simple. However last years return was completed by the firm my old employers used. I have asked them for a quote for this years return and at around $800 this seems excessive.

Couple of questions:

1) What would you roughly expect a reasonable tax firm/advisor to charge to complete a tax return roughly along the lines I have described (I know there is not nearly enough detail there -but honestly, I have no investments/interest/income other than what I was being paid!).

2) Could I even begin to try and do this myself. Last years return really didn't look that complicated. Or is there an added complexity with the fact that I returned permanently to the UK? The tax firm who gave me the quote kept talking about the 'final' return.

If anyone wants to suggest or endorse anyone who you feel could help (Its not the kind of thing I feel particularly happy about just asking google for!) with returns, I'd be very appreciative. Not least because my affairs need to be correct because in my new job there is a strong possibility I could be return on another L visa.

Thanks!
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Old Jan 16th 2014, 7:58 am
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Default Re: Tax return advice and costs

I've just re-read my old thread and noticed lots more replies including Peter Newton's contact details. Very helpful. But if anyone has more - I'd be grateful!
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Old Jan 16th 2014, 10:18 am
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Default Re: Tax return advice and costs

$800 for a somewhat complicated tax return prepared by a tax professional, it doesn't seem to be entirely in the wrong ballpark. Mrs P and I pay a little less for our personal return, which is too convoluted for us to trust H&R Block (or similar), but not massively complicated either. The tax accountant we use is in a small office in a remote small town, which likely makes his fees/rates lower than than big city accountants.
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Old Jan 16th 2014, 12:20 pm
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Default Re: Tax return advice and costs

Originally Posted by godisaclog View Post
I've just re-read my old thread and noticed lots more replies including Peter Newton's contact details. Very helpful. But if anyone has more - I'd be grateful!
We are using Peter for our first return. There's a fair amount of work involved as we arrived in June 2013 so are "dual status". Additionally there's some pensions and we rent out our UK property. We have been quoted around $1200. It might be high, but there's no way we want to attempt this ourselves!
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Old Jan 17th 2014, 6:44 am
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Default Re: Tax return advice and costs

I've been using Pete Newton for several years now. I highly recommend him.
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Old Jan 18th 2014, 7:00 pm
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Default Re: Tax return advice and costs

Sounds like you'll have exactly the same return as you had last year, so you can always use that as a template. All the forms are available on irs.gov.

The complexity in your case is that you also have foreign income (UK) that the US may want to know about too.

Then again, I don't think you pass the substantial presence test (SPT) and will therefore be taxed at a higher rate as a non resident alien with none of the benefits like exemptions. This is based on some tax volunteering i've done, but please double check everything. You also have the option of using UK based tax preparers as there are many US expats in the UK.
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Old Jan 18th 2014, 7:18 pm
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Default Re: Tax return advice and costs

If anyone new on here wants to contact Pete Newton.
www.britishexpatstax.com
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Old Jan 18th 2014, 7:25 pm
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Default Re: Tax return advice and costs

Pulaski...why aren't you using TurboTax or similar?
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Old Jan 18th 2014, 8:09 pm
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Default Re: Tax return advice and costs

Originally Posted by HartleyHare View Post
We are using Peter for our first return. There's a fair amount of work involved as we arrived in June 2013 so are "dual status". Additionally there's some pensions and we rent out our UK property. We have been quoted around $1200. It might be high, but there's no way we want to attempt this ourselves!
We were in a similar position one year and we had ours done professionally. The amount of paperwork generated by renting out a house was astonishing...
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Old Jan 19th 2014, 4:49 pm
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Default Re: Tax return advice and costs

Originally Posted by kins View Post
We were in a similar position one year and we had ours done professionally. The amount of paperwork generated by renting out a house was astonishing...
Really? You report the rental profit (or loss) on Schedule E of your form 1040. It's not that difficult.

Normally, a single U.K. rental property doesn't generate a U.K. tax liability (due to the personal allowance) so you shouldn't need to complete a foreign tax credit form 1116 if this is your only non-U.S. income.

In answer to the original question, first year and last year U.S. returns are a lot more complex than usual and the fee doesn't seem unreasonable for what's involved. You also have a more complex U.K. tax situation as you may have remained U.K. resident all along.

But if you were on L1 - whys is your employer not paying?
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Old Jan 20th 2014, 5:12 am
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Default Re: Tax return advice and costs

I have a tax return question, I am married and file jointly we my wife, we both have Bank accounts in England and receive a small amount of interest along with a small pension and a small monthly annuity which we will delcare to the US IRS, the paperwork we have from the bank and annuity show taxable income years 2012 to 2013 as the British tax year is from April to April, do we file this as our 2013 US tax return or figure out what the actual overseas income will be for the next few months or should we file a request for an extention until get the 2013 to 2014 statements?

Last edited by Westham; Jan 20th 2014 at 5:14 am.
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Old Jan 20th 2014, 5:31 am
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Default Re: Tax return advice and costs

Originally Posted by Westham View Post
I have a tax return question, I am married and file jointly we my wife, we both have Bank accounts in England and receive a small amount of interest along with a small pension and a small monthly annuity which we will delcare to the US IRS, the paperwork we have from the bank and annuity show taxable income years 2012 to 2013 as the British tax year is from April to April, do we file this as our 2013 US tax return or figure out what the actual overseas income will be for the next few months or should we file a request for an extention until get the 2013 to 2014 statements?
The Us tax year is January 1st until December 31st. Those are the dates that you need to go by not April to April. You should have your December 2013- January 2014 Statements by February at the latest. Taxes are not due until April 15th so you should have your all your statements well before then. My husband has a few UK bank accounts and the statement dates are different but we normally have them by the end of January. His Uk mortgage statement doesn't come out until mid February so he normally just calls the bank for the info before it's mailed out.
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Old Jan 20th 2014, 12:48 pm
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Default Re: Tax return advice and costs

Originally Posted by JAJ View Post
Really? You report the rental profit (or loss) on Schedule E of your form 1040. It's not that difficult.
No there was more to it than that for us. But then we had a slightly unusual house ownership situation.
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Old Jan 20th 2014, 1:45 pm
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Default Re: Tax return advice and costs

Originally Posted by penguinbar View Post
The Us tax year is January 1st until December 31st. Those are the dates that you need to go by not April to April. You should have your December 2013- January 2014 Statements by February at the latest. Taxes are not due until April 15th so you should have your all your statements well before then. My husband has a few UK bank accounts and the statement dates are different but we normally have them by the end of January. His Uk mortgage statement doesn't come out until mid February so he normally just calls the bank for the info before it's mailed out.
Thank you for your response Penguinbar, I figured it would be that way but glad for the confirmation.
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Old Jan 20th 2014, 2:34 pm
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Default Re: Tax return advice and costs

Originally Posted by Westham View Post
Thank you for your response Penguinbar, I figured it would be that way but glad for the confirmation.
You're welcome.
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