# US taxes on foreign earnings?



## GeeBeeDubyah (Apr 20, 2015)

We are considering an offer my wife has for a job in Hong Kong, reportedly will bring in a little less than $US80K per year after HK taxes.

Will be hitting our accountant in US as well, but would welcome general input from the US expats about how IRS deals with off-shore earnings, and what sort of hoops we will need to hop through to comply.

- Will we need to keep, or avoid to keep, a permanent US address?

- Is there a set number of days she will need to remain overseas each year?

- If I remain working in the US, while she is off-shore, does that make her foreign salary more taxable in the US?

Thank you


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## GeeBeeDubyah (Apr 20, 2015)

Also would welcome input on pitfalls of where we end up maintaining bank accounts. I have just seen stuff about FBARS (for the first time), so will try to research if that pertains to this subject too...


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## Bevdeforges (Nov 16, 2007)

First of all, you should take a look at IRS Publication 54 Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad which will give you the overview of how to file US taxes from overseas.



> - Will we need to keep, or avoid to keep, a permanent US address?


It's up to you whether you want to maintain or avoid having a permanent US address. Be aware that by maintaining a US "residence" you may remain liable for State income taxes where you live. Check to see what your state does about income subject to the FEIE (Foreign Earned Income Exclusion) - some states give you no break at all.


> - Is there a set number of days she will need to remain overseas each year?


In the first year, in order to qualify for the Physical Presence test (both for FEIE purposes and potentially for the ACA medical insurance requirement), she'll need to remain outside the US for 330 days in a period of 12 consecutive months. Thereafter, she may be able to claim "bona fide resident" status - which requires that she have residence outside the US for a full calendar year. (But that's all explained in Pub 54)


> - If I remain working in the US, while she is off-shore, does that make her foreign salary more taxable in the US?


No, each spouse has their own claim on the FEIE, and if you choose to take the Foreign Tax Credit instead, what matters is how much income tax she pays to Hong Kong or any non-US government.

As far as bank accounts are concerned, yes, she'll have to report all foreign bank accounts once the balance in all such accounts is over $10,000 but that's a simple report that doesn't have any direct tax consequences. If you're a joint holder of any foreign accounts with her, you'll have to report the accounts, too.

Where things start to get complicated is when you start investing in foreign stocks, bonds or various forms of mutual funds or other investment instruments offered through banks or brokers outside the US. 
Cheers,
Bev


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## GeeBeeDubyah (Apr 20, 2015)

Thank you Bev


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## BBCWatcher (Dec 28, 2012)

GeeBeeDubyah said:


> - Will we need to keep, or avoid to keep, a permanent US address?


A couple more comments here.

"Permanent U.S. address" is a bit of a loaded term. You _can_ keep a U.S. mailing address without any particular tax consequences. A mailing address could be that of a trusted friend or relative, or it could be with a U.S. Postal Service authorized mail forwarder. There is often value and convenience in having a U.S. mailing address.


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