Tax questions..

[JoeCanuk 3]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

[JoeCanuk 3]

Selly,

You apparently didn't read the entire thread. I mentioned you may not have to pay tax on your foreign income. Don't jump to conclusions about the 'criminal' tax code without researching for your particular situation.

Let me get this right, my income that I earned this year in the UK and was taxed for in the UK, now becomes part of my wifes tax liability as well? What right do the IRS have to tax income that has already been taxed in another country, this is criminal beyond belief!

I was of the understanding that because we are unable to work (well most of the K1 anyway) our spouses can still file jointly and benefit from our allowance that we havent earned yet ie the first earnings that you do not pay tax on.

I think a bit of tax lawyer advice might be the order of the day as my income in the UK was pretty good and it wouldnt be fair for my wife to be saddled with a huge tax bill based on something that has now passed. She never really benefitted from the money so why should she be taxed on it??

Apologies for getting on my soap box. I am quite rightly pretty frustrated with the levels of incompetent bureaucracy that are demonstrated every day in this 'leader of the free world'. I love my life here with my wife, but boy does the administration know how to make a mountain out of a molehill. However in response to your accusatory comment:

Many thanks for 'jumping to the conclusion' that I had not read all of your post, I had. My response was tailored towards your correctly guarded comment that 'you may not have to pay tax on your foreign income'. which if it does happen, will be in my humble opinion, a criminal act against the people. I was also not calling the tax code criminal, just the practice of double taxation, should it occur, which is I know, just the tip of an extremely complex taxation system that is in place . The USCIS creates enough of a financial burden on the US citizens wishing to bring loved ones to live with them in their own country, without the potential of being asked to pay a tax liability that isnt theirs.

Dare I say it if it does come to pass, this is another example of the system picking off easy targets within the immigration proccess, when they should be focussing their efforts where the real problem lies elsewhere. Got to pay for the war somehow after all.

What I'd like to know is how the U.S. government can even FIND out how much we made in our previous country. Don't privacy laws prevent our native country from reporting that to the U.S.?

[Kez/JWolf 6]

Selly,

You apparently didn't read the entire thread. I mentioned you may not have to pay tax on your foreign income. Don't jump to conclusions about the 'criminal' tax code without researching for your particular situation.

Let me get this right, my income that I earned this year in the UK and was taxed for in the UK, now becomes part of my wifes tax liability as well? What right do the IRS have to tax income that has already been taxed in another country, this is criminal beyond belief!

I was of the understanding that because we are unable to work (well most of the K1 anyway) our spouses can still file jointly and benefit from our allowance that we havent earned yet ie the first earnings that you do not pay tax on.

I think a bit of tax lawyer advice might be the order of the day as my income in the UK was pretty good and it wouldnt be fair for my wife to be saddled with a huge tax bill based on something that has now passed. She never really benefitted from the money so why should she be taxed on it??

Apologies for getting on my soap box. I am quite rightly pretty frustrated with the levels of incompetent bureaucracy that are demonstrated every day in this 'leader of the free world'. I love my life here with my wife, but boy does the administration know how to make a mountain out of a molehill. However in response to your accusatory comment:

Many thanks for 'jumping to the conclusion' that I had not read all of your post, I had. My response was tailored towards your correctly guarded comment that 'you may not have to pay tax on your foreign income'. which if it does happen, will be in my humble opinion, a criminal act against the people. I was also not calling the tax code criminal, just the practice of double taxation, should it occur, which is I know, just the tip of an extremely complex taxation system that is in place . The USCIS creates enough of a financial burden on the US citizens wishing to bring loved ones to live with them in their own country, without the potential of being asked to pay a tax liability that isnt theirs.

Dare I say it if it does come to pass, this is another example of the system picking off easy targets within the immigration proccess, when they should be focussing their efforts where the real problem lies elsewhere. Got to pay for the war somehow after all.

You do not have to pay tax twice on your UK earnings you claim a foreign tax credit..... the US tax system is no more dificult than the UK's only diffrence is that it is deducted at source in the UK where as here it is down to each person to ensure that they file their tax return....

Kez

[selly 0]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

I agree, what about the people who have no idea of the US taxation system etc or what they can or cannot claim back? That is what this post is all about, an area that from what I can see no-one actually knows the answer. Would you rather blindly fill in a tax return without having an idea what you are doing and risk getting a heafty bill, or have the correct answers prior to filing and potentially reap benefits? Surely if the tax lawyer is going to save you money above his fees, or if H&R Block is going to make it simpler, then that is the way forward.........

[Kez/JWolf 6]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

People like peace of mind that if a problem arrises with their tax return then they have someone to sort it all out..... also unless you know exactly what you can claim for or deduct then you could well be missing out on a better refund or small amount to pay.... companies like H&R Block assist people who want the security of knowing it will be filed right and a fast way to get your refund, that does not make you a dummy and not everyone wants to spend hours trawling through IRS Publications looking for what they can and can't claim.... As a tax Pro I know just how hard it can be to understand the language that IRS use in their publications....

Kez

[selly 0]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

People like peace of mind that if a problem arrises with their tax return then they have someone to sort it all out..... also unless you know exactly what you can claim for or deduct then you could well be missing out on a better refund or small amount to pay.... companies like H&R Block assist people who want the security of knowing it will be filed right and a fast way to get your refund, that does not make you a dummy and not everyone wants to spend hours trawling through IRS Publications looking for what they can and can't claim.... As a tax Pro I know just how hard it can be to understand the language that IRS use in their publications....

Kez

Now that I know you are a tax pro Kezzie, I can take some comfort from your assurance that we will not be taxed again. I do have a question on the different tax years though. Normally the UK half would use the info from their P60 to declare their earnings, which is obviously a formal document. It does however only run from April so three months of income will be missing that cannot be supported by the P60, based on the Jan - Dec US tax year. Would you recommend an estimate or just run with the P60 as it will not make any difference to the outcome?

[Kez/JWolf 6]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

People like peace of mind that if a problem arrises with their tax return then they have someone to sort it all out..... also unless you know exactly what you can claim for or deduct then you could well be missing out on a better refund or small amount to pay.... companies like H&R Block assist people who want the security of knowing it will be filed right and a fast way to get your refund, that does not make you a dummy and not everyone wants to spend hours trawling through IRS Publications looking for what they can and can't claim.... As a tax Pro I know just how hard it can be to understand the language that IRS use in their publications....

Kez

Now that I know you are a tax pro Kezzie, I can take some comfort from your assurance that we will not be taxed again. I do have a question on the different tax years though. Normally the UK half would use the info from their P60 to declare their earnings, which is obviously a formal document. It does however only run from April so three months of income will be missing that cannot be supported by the P60, based on the Jan - Dec US tax year. Would you recommend an estimate or just run with the P60 as it will not make any difference to the outcome?

You should have a P45 or a P60 from when you left your employment in the UK so to calculate your taxable income you will need your last P45/P60 and your P60 from the previous year... so if you moved to the US in say June 2007 then you need to workout your income from Jan 2007 to Dec 2007, count how many weeks between Jan 1st and April 5th, then take the amount shown on P60 for the period April 6th 2006 to April 5th 2007 and divide by 53 then times by number of weeks from Jan to April... then take info from P45/P60 that covers from April to date you left UK and add that amount to the total for Jan - April...

Kez

[zqt3344 21]

Calm down. You will get to file a foreign income tax credit with IRS so you do not get taxed twice on your income from whatever UK country you came from. And you will have option of filing jointly or separately if married during 2007 and at end of Dec 31, 2007.

So, here's my story. My husband came from Scotland in April to move over here. He came on a fiance visa. In October he received his EAD, so he's been working since November. I just received an email saying that he's basically been approved of his AOS. He'll be receiving his resident card shortly. The questions are, what am I to do on taxes? I've tried reading up on it, but a lot of people have mentioned having a spouse who is a non-resident at the time. But since my husband will officially be a resident (conditional), won't that change things? I can now file married jointly, right? Isn't that the biggest issue? I read something also about having to claim his income from his home country as well? If there is just a place to go that should have all of these answers and more, please point me in the right direction. I just want to have an idea of what I have to do when it comes time to file.

Thanks!

[athena_ny 1]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

But you're not getting your refund right away, (most of the time) you're getting a loan check, and if something is wrong with the taxes they did for you, you can wind up having to pay money back.

For the most part, I'd agree with Fwaguy. I've been doing my own taxes since I was 16, and I'm not a rocket scientist. The calling people dummies, etc. I don't agree with, for most it's a comfort thing to go to a tax professional and I'm not berating the profession, but I use turbo tax and it walks me through the entire thing, and is relatively painless. It's a personal decision, but with the advent of the internet, doing your own taxes is not that difficult anymore.

If you have a special situation, I'd recommend seeing a professional, but with us it's pretty straightforward and easy to do.

And besides, I have my refund within 3 days of filing online. If you use H&R Block for the instant gratification...does 3 days really make that much of a difference?

Edited for clarity

Edited December 20, 2007 by meow mix

[Caladan 19]

For what it's worth, I find the tax code harder than immigration. (And we don't call people lazy or stupid for hiring a lawyer for immigration, sooo...)

[zqt3344 21]

For what it's worth, I find the tax code harder than immigration. (And we don't call people lazy or stupid for hiring a lawyer for immigration, sooo...)

[rebeccajo 14]

Selly,

You've overread what I wrote to you insofar as it being 'accusatory' of anything other than trying to interpret what you wrote.

I said may because I do not know what you earned. Whether or not you will owe any taxes to the US Government depends on the total of your 2007 income combined with your wife's 2007 income (if you file jointly). If that amount exceeds the ceiling set by the IRS you will owe taxes on the amount above it. The amount of the ceiling changes each year - I believe for tax year 2006 it was around $85000 US dollars.

And as far as anyone being able to get an 'answer' in this thread, none of us can really do that. The situation for each immigrant is different based upon whether or not they pass the 'physical presence test' plus how much they earned in their home country. So no one is being evasive - it's just that there is not one answer for all taxpayers.

And yes - the US tax system is overly complicated. My husband can't quite get over it, and 'yes-dears' me whenever I tell him we need to do such and such. It really is a nuisance.

Selly,

You apparently didn't read the entire thread. I mentioned you may not have to pay tax on your foreign income. Don't jump to conclusions about the 'criminal' tax code without researching for your particular situation.

Let me get this right, my income that I earned this year in the UK and was taxed for in the UK, now becomes part of my wifes tax liability as well? What right do the IRS have to tax income that has already been taxed in another country, this is criminal beyond belief!

I was of the understanding that because we are unable to work (well most of the K1 anyway) our spouses can still file jointly and benefit from our allowance that we havent earned yet ie the first earnings that you do not pay tax on.

I think a bit of tax lawyer advice might be the order of the day as my income in the UK was pretty good and it wouldnt be fair for my wife to be saddled with a huge tax bill based on something that has now passed. She never really benefitted from the money so why should she be taxed on it??

Apologies for getting on my soap box. I am quite rightly pretty frustrated with the levels of incompetent bureaucracy that are demonstrated every day in this 'leader of the free world'. I love my life here with my wife, but boy does the administration know how to make a mountain out of a molehill. However in response to your accusatory comment:

Many thanks for 'jumping to the conclusion' that I had not read all of your post, I had. My response was tailored towards your correctly guarded comment that 'you may not have to pay tax on your foreign income'. which if it does happen, will be in my humble opinion, a criminal act against the people. I was also not calling the tax code criminal, just the practice of double taxation, should it occur, which is I know, just the tip of an extremely complex taxation system that is in place . The USCIS creates enough of a financial burden on the US citizens wishing to bring loved ones to live with them in their own country, without the potential of being asked to pay a tax liability that isnt theirs.

Dare I say it if it does come to pass, this is another example of the system picking off easy targets within the immigration proccess, when they should be focussing their efforts where the real problem lies elsewhere. Got to pay for the war somehow after all.

Edited December 20, 2007 by rebeccajo

[desert_fox 32]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

People like peace of mind that if a problem arrises with their tax return then they have someone to sort it all out..... also unless you know exactly what you can claim for or deduct then you could well be missing out on a better refund or small amount to pay.... companies like H&R Block assist people who want the security of knowing it will be filed right and a fast way to get your refund, that does not make you a dummy and not everyone wants to spend hours trawling through IRS Publications looking for what they can and can't claim.... As a tax Pro I know just how hard it can be to understand the language that IRS use in their publications....

Kez

These posts have to be the most offensive, or from ppl who never completed the sixth grade who use H&R Block to get a quick refund. What you are getting is an instant loan that you are paying somewhere around 25% annual interest. Only someone who is not too smart would do something like this...its preying on poor ppl and the practice should be outlawed. Evun filing a TurboTax return electronicall will get you refund in 7-10 days without paying a dime in interest.

With all due respect to Kezzie, I would not consider anyone working for H&R Block as a tax professional, but only as a clerical that just transcribes numbers from the source information that your clients bring you. There are no professional services provided, there are no decisions to make, and is strictly a clerical function.

I would think that all you newbies to the tax system would take a look at the simple forms yourselves and development a general understanding how this "complex"" system works for ppl who are filing returns bsed upon earnings only. Simple adding and subtracting, and giive you a general understanding on what kinds of incomes are taxable and what expenses are not taxable (interest on home, medical payments, uniform and education expenses, etc.) If y9ou feel offended, then you should be offended at your own ignorance of just throwing up your hands and declaring it complex, which it is not.

The only time it would become complex is if you are buying and selling stocks, and need to time them right to avoid paying taxes. Even H&R Bloock clericals are not trained to know how to do this. Another example when it gets complex is if you own rental properties which involves depreciation accounting and keeping track of deductible business expense. But if we are talking about the average married couple living off of wages, and so not own a home, and have no usual medical expense, then we are talking about 1040EZ....about 20 minutes to prepare. Or you can pay H&R Block 100 dollars and 25% interest for your instant refund (which is CRIMINAL in my opinion...worse than payday loan sharks.

[Kez/JWolf 6]

[

US tax law is very complicated. What you might be thinking is double taxation situation may not even remotely be the case. This area of the tax law is complex and there are exclusions and exceptions everywhere.

Can be complicated. but if we are talking about paying taxes on ordinary income, it becomes quite simple. Anyone who can balance a check book can figure their taxes. If you finished grade school math and can add and subtract, then you can do your own taxes. It also requires a few table look-ups. If you are confused about what is taxable, etc., there are publications available on the IRS site, along with examples. If it is still too camplex for you then use turbo tax (available on the internet), and file for $25.

People who suggest to use a tax lawyer or a tax accountant (CPA) are looking at $200 per hour to do simple math. H&r Block, etc. are for real dummys. Most likely you can do everything on the 1040EZ unless you are deducting home mortgage interest, and medical expenses, etc., (which are not taxable).

That was offensive. Some people like to use H&R Block so they can get their tax refund right away.

People like peace of mind that if a problem arrises with their tax return then they have someone to sort it all out..... also unless you know exactly what you can claim for or deduct then you could well be missing out on a better refund or small amount to pay.... companies like H&R Block assist people who want the security of knowing it will be filed right and a fast way to get your refund, that does not make you a dummy and not everyone wants to spend hours trawling through IRS Publications looking for what they can and can't claim.... As a tax Pro I know just how hard it can be to understand the language that IRS use in their publications....

Kez

These posts have to be the most offensive, or from ppl who never completed the sixth grade who use H&R Block to get a quick refund. What you are getting is an instant loan that you are paying somewhere around 25% annual interest. Only someone who is not too smart would do something like this...its preying on poor ppl and the practice should be outlawed. Evun filing a TurboTax return electronicall will get you refund in 7-10 days without paying a dime in interest.

With all due respect to Kezzie, I would not consider anyone working for H&R Block as a tax professional, but only as a clerical that just transcribes numbers from the source information that your clients bring you. There are no professional services provided, there are no decisions to make, and is strictly a clerical function.

I would think that all you newbies to the tax system would take a look at the simple forms yourselves and development a general understanding how this "complex"" system works for ppl who are filing returns bsed upon earnings only. Simple adding and subtracting, and giive you a general understanding on what kinds of incomes are taxable and what expenses are not taxable (interest on home, medical payments, uniform and education expenses, etc.) If y9ou feel offended, then you should be offended at your own ignorance of just throwing up your hands and declaring it complex, which it is not.

The only time it would become complex is if you are buying and selling stocks, and need to time them right to avoid paying taxes. Even H&R Bloock clericals are not trained to know how to do this. Another example when it gets complex is if you own rental properties which involves depreciation accounting and keeping track of deductible business expense. But if we are talking about the average married couple living off of wages, and so not own a home, and have no usual medical expense, then we are talking about 1040EZ....about 20 minutes to prepare. Or you can pay H&R Block 100 dollars and 25% interest for your instant refund (which is CRIMINAL in my opinion...worse than payday loan sharks.

I find your comments about people to be very disrespectful..... just because you do your own taxes does not mean you have the right to belittle people who dont do their taxes.... I do not work for H&R Block so I can not comment on how much training they get.... but I do know that just because you use H&R Block does not mean you have to take any sort of loan... that is just one of the products they offer... you can have your tax return e-filed by them and have any refund paid to you by direct deposit.... no other fees involved other than the tax prep fee....

so unless you work for H&R Block and have full knowledge of how they opperate and what services they offer, I dont think you should be advising people that they are loan sharks....

Just because people deceide to have their taxes done by an accountant or other Tax Pro does not mean that they are any less educated than someone who chooses to do their own... I also know for a fact that many people who do work for H&R Block are retired IRS officers and accountants....

Kez

[Caladan 19]

Dude, you can pay a CPA to look over your paperwork and not get an automatic refund. You're acting like it's about idiots wanting fast money when it might be just wanting someone else taking responsibility for signing off on it. I've used an accountant in the past; last year I filed the 1040EZ myself; this year I might hand it off to an accountant because C. has income in Canada and income here.