Death and Taxes.

[JayJay 4]

Posting this here as it gets more traffic...

My mother in law rang up the IRS today, and apparantly they said that all of my income from the UK is taxable here in the US. I wasn't aware that was the case?!

Something about that they can offset the taxes I paid in the UK against the taxes here? Now I am seriously worried - this is the last thing I need right now, another problem. Now according to the IRS I have to get hold of my tax information from the UK?

Has anyone else run into this? I thought income up to $80,000 was considered "done" and "dusted" and that the UK share a taxing agreement with the USA. Now apparantly I have to pay taxes twice? I am calling the IRS tomorrow regarding this, but unfortunately it sparked a huge debate as soon as I got home from work today and I am just quite simply wrong.

I am quite miffed. I'd like to be out of here asap anyway, but this is just getting ridiculous. Any help and advice regarding this would be totally appreciated, so that I can go back to the IRS tomorrow, info in hand...

Thanks people!

Your's Truly,

Mrs *Annoyed* Jay

[Mr. Big Dog 10,747]

You worry too much.

[JayJay 4]

You'd think, wouldn't you, but apparantly now I need to find some info from the UK about how much I earnt, and if I cannot find it, then I will be taxed AGAIN here in the US.

It's all gobbledegook to me, and I've already had my head bitten off twice for questioning anything. Which is why I am talking to IRS tomorrow. Myself.

My mother in law is doing our taxes this year, you see, since I don't know anything about taxes here. Feckin' ay.

I am so pissed right now that I feel like walking out. I didn't need this at the end of today.

[Mr. Big Dog 10,747]

You don't know your 2005 earned income in the UK and what taxes you paid there on it? How come?

[JayJay 4]

Well - I don't have anything with me to prove that. I didn't think I'd be staying, so bringing my P45 wasn't on my mind. We don't get W2's in the UK.

[Trompe le Monde 1,107]

Here Jay, read this link to see if you qualify for the foreign earned income exclusion:

http://www.irs.gov/businesses/small/intern...d=96822,00.html

You probably need a copy of your last P-60, and probably your P-45. I think you can get copies from the Inland Revenue?

[Mr. Big Dog 10,747]

Well - I don't have anything with me to prove that. I didn't think I'd be staying, so bringing my P45 wasn't on my mind. We don't get W2's in the UK.

Relax: You ain't got to prove a thing. You just have to declare what you made. Then you take a look at form 2555-EZ and see how much of that you get to exclude from US taxation.

We did this and didn't have a shred of evidence of Nani's earnings overseas. Nobody ever asked for any evidence, either.

[Trompe le Monde 1,107]

Also look at this link under nonresident alien (is that your status until your AOS interview?)

http://www.irs.gov/businesses/small/intern...d=96414,00.html

[JayJay 4]

Glad to hear it. I got in the front door this evening and said "Hello!" and then was greeted by the foolowing (condensed):

"Hello, here's spaghetti in the frige. By the way, your income from the UK DOES need to be declared, and if you need to pay the IRS taxes, you will do so, or go to Federal Prison."

I was like: "F*ckin' thanks! Where's the nearest exit?"

[Mr. Big Dog 10,747]

Also look at this link under nonresident alien (is that your status until your AOS interview?)

http://www.irs.gov/businesses/small/intern...d=96414,00.html

Not sure that the nonresident filing status is a good idea.

[Hilarious Clinton 452]

It works between US states like that too. I live in Mass but work in New York. Whatever taxes I paid in New York is credited towards my Mass taxes.

[mawilson 2,133]

JayJay,

Don't worry. You do need to declare your UK income, but under no circumstances will you be taxed twice.

I'm pretty sure there's a foreign tax credit -- if you're lucky you might even get some money back.

Mark

[arwensun1965 0]

I am dealing with the inland revenue as I write this. I have to fill in a P85 it is a form you have to fill in and send back to the inland revenue and you have to send in your P45 as well. If you live abroad you can still do this, they work out if you are owed any money or not and when I spoke to the helpline this morning the person said that it looked like that I was owed money. Jay go to the Inland revenue site it will explain it better and there is a downloadable form to fill in (yes you can still claim).

Janice

[Girona40 0]

I filed the P85 when I left the UK, 4 years ago, and they sent me a nice tax rebate cheque.

I have never heard of someone having to declare earnings you made while you were resident in another country, that you have already paid all relevant taxes on.

This is a new one to me and my husband has used an accountant to do our taxes for years. He told the accountant that we married, that I was an immigrant and that I previously lived in the UK - at no time did they need any proof of earnings for me from the UK.

I can't see the fairness of that. Now if your main place of residence was the US and you were working in the UK I could understand it, but not if you are a British citizen and just moved here.

I just asked my hubby and he said "nope, you don't have to declare any of your earnings prior to immigrating to the US". I said "but her MIL is saying she does". His response to that was "her MIL is full of sh*t"!! He's direct like that!

[JayJay 4]

Lmao Girona, that's priceless

I want to do this P85 thing as well. Firstly I am going to go and speak to IRS myself because to be perfectly honest, if I hear any more prison talk, I am just going to stand on a chair and release plates from my left hand to get rid of some stress. And they won't be my plates.

So....I guess I need to get in touch with the IR, and see whether I can't get my P45. Not that that would be so relevant anyway, as that'd show me what I earnt during my employment, rather than what I earnt from January to May...

Havig said that, clever little Jay went down to the basement last night to look through the paperwork I DID bring - which I knew included some pay slips, as I didn't want to leave them in a bag somewhere. Well, I managed to find all of my wage slips from my bar job, excluding May's as I left on the day they were issued. Then I found three out of five of the wage slips for my regular job as well

So because I still had my old filofax diary (a blessing in disguise), I was able to estimate the hours worked at the bar in May (I used to write the times in each day I went in) and then the wages for May from my other job would have been the same as in April

Et voila! I have come up with a list of full earnings, and taxes on my full time job. Now I just have to come up with the taxes for May for my part time job, and we're done

And ooh yeah - underneath all my wage slips, were my P60's for BOTH jobs in 2005 How organised was I? I didn't even realise...But sadly, no P45s

Edited February 9, 2006 by JayJay