the scotsman

Hi Guys,
Need some advice or personal experience, Been in the US since the start of 2007 on a L1B and was paid through my UK company in to my UK account paying uk taxes. I Haven't paid US taxes since i got here. There was 4 months i got paid in to my US account but always paid UK taxes. Do i need to claim my UK taxes back? Then pay the IRS?
If the IRS come knocking who is resposiible for the tax due? Is it on the employee? Or the Companies head?
I have left the company i worked since and have not earned since june 2009 I don't mind paying tax...Its just a factor of life but if the IRS knock on my door and ask for $$$ i Cannot afford to pay my bill, If it did come to this and the IRS asking for $$$ is it something i could take my ex company to court to foot the bill?
I have talked to Tax people in the US off the cuff and no one gives any good advice no one seems to know the ruling with the tax treaty.... And unfortunaty i can't afford to get real advice!
Thank you for your time
Andy

JAJ

If you were resident in the USA, you are supposed to file for USA tax. And you probably didn't need to pay UK tax. Most L visa employers understand the tax issues involved in transferring people, you situation sounds unusual.

meauxna

Andy, there is no simple way to give an answer to your question.. the answers are pretty much the same as they were a year ago when you asked. Except that now, you are presumably a PR? And you are going to have to file married income tax returns, so your wife really needs to be involved too.
I didn't have a ton of money our first years either, so I did a LOT of studying and still needed to hire a CPA to prepare our first return (I picked a bad one; we have at least one good one posting here).

You MAY owe US taxes. Reading your old posts, your boss is unfamiliar with the US tax system and may have done you a real disservice. If the IRS comes knocking though, it is YOU who is responsible.

You really, really need to find some help and educate yourself about the treaty.
If you owe IRS a large amount, you can ususally work out a re-payment plan if it comes to that. What you can't do is ignore it. Your wife must also file as 'married' now, so again, you must involve her.

Michael

You do owe the US taxes. The US has a statute of limitation of 3 years on collecting back taxes but only if you filed a tax return. If you didn't file a tax return, there isn't any statute of limitations.

I think you should try to get the situation resolved as quickly as possible since there may be a statute of limitations in the UK for getting a refund for the back taxes paid. You really need to see a good tax accountant to try to get the issue resolved.

Unfortunately it is your responsibility to pay the taxes and not the company.

I had a friend from the UK that was in a similar situation in the 1970s. He was sent to the US to set up a subsidiary to purchase parts and to hire about 6 Americans to assist. All of the American employees were put on US payroll but he wasn't. After about 4 years, the IRS froze his bank accounts. He immediately flew back to the UK and refused to return to the US unless he got a commitment that the company would resolve the issue and pay the back US taxes owed. He got got the commitment so he returned.

Peter Newton

Just to be clear - with certain exceptions taxes must be assessed within 3 years of the due date of the return (if one was filed). Once assessed, the IRS generally has 10 years to collect the tax due.

meauxna

Oh, speak of the devil.

lifehouse51

What does the ASSESSMENT entail? Does it mean they have 3 years to conduct an audit on your tax return?

Michael

True, I made a mistake in my wording. Thanks for correcting that.

Also from my understanding the IRS will generally not access taxes after 10 years if a person never did file a tax return. I don't believe that is a law but just a general rule that the IRS follows. They possibly may not abide by the rule if they are going after some drug lord.

Peter Newton

It basically means the IRS has sent you a formal bill for tax they think you owe. Often it's the end result of an audit.