Filing taxes in the first year after a K1 visa

[Wuozopo 4,285]

2 hours ago, Chelleyandaaron said:

So - am I right in thinking that I declare all my income from self-employment (what evidence is required?

The weird thing is....no evidence is required. You should have some kind of notes or documents on how you came up with your income and the conversion rate you used on the off chance that you got audited. 

 

Are you understanding the exclusion properly. Just because the maximum exclusion is in round numbers $100k a year, you only get to exclude what you earned. If you were only resident abroad half a year, then the most would be half the $100k.  

 

So let's say you qualify to exclude up to $50k because you were only resident in the U.K. half the year. If your income is $15k, then you exclude $15k. If your income is $60k, you are shut down excluding at $50k maximum based on only being abroad half the year. 

Edited January 17, 2018 by Wuozopo

[Chelleyandaaron 511]

On 16/01/2018 at 7:14 PM, Wuozopo said:

The weird thing is....no evidence is required. You should have some kind of notes or documents on how you came up with your income and the conversion rate you used on the off chance that you got audited. 

 

Are you understanding the exclusion properly. Just because the maximum exclusion is in round numbers $100k a year, you only get to exclude what you earned. If you were only resident abroad half a year, then the most would be half the $100k.  

 

So let's say you qualify to exclude up to $50k because you were only resident in the U.K. half the year. If your income is $15k, then you exclude $15k. If your income is $60k, you are shut down excluding at $50k maximum based on only being abroad half the year. 

Thanks for your reply @Wuozopo - yes i think I understand the exclusion.  It simply means that if I earn below that amount ($50k) in my overseas earnings, those overseas earnings will effectively be excluded from my taxable income (so it will be declared but then deducted).  I was in the UK for the first six months of the year so it is about a $50k cap for me but I didn't earn that much in that period so effectively it will be irrelevant (although I still need to complete all the paperwork)

[Homeskin 1]

Hey guys, 

 

Resurrecting this thread as it's getting closer to the time - does anyone know of any good tax software that takes into account the PFICs or would it be best to go directly to a CPA to file and avoid the IRS crawling up my butt? (there's already plenty of stuff up there).

 

Thanks in advance!

 

H

[Wuozopo 4,285]

1 hour ago, Homeskin said:

Hey guys, 

 

Resurrecting this thread as it's getting closer to the time - does anyone know of any good tax software that takes into account the PFICs or would it be best to go directly to a CPA to file and avoid the IRS crawling up my butt? (there's already plenty of stuff up there).

 

Thanks in advance!

 

H

Well I found this...

 

"Form 8621, the tax form that PFIC investors are required to fill out, is a lengthy, complicated form that the IRS itself estimates may take more than 40 hours to fill out. For this reason alone, PFIC investors are generally advised to have a tax professional complete the form for them."

 

Bloody  'ell

[Homeskin 1]

Man, that kinda sucks - I have a H&R Block CPA quoting me $300 to do my tax returns which seemed pretty expensive to me but doesn't seem completely absurd now. 

 

Think I'll get some quotes from other CPAs...

[TBoneTX 43,133]

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