# Mexico income tax for a US expat working in Saudi



## jlbenitz (Aug 2, 2015)

Hi folks. New here so if this subject or something like it has already been posted please point me in the right direction. My wife and I are considering moving to Mexico to attempt to get around some of the US income tax burden on my salary from working in Saudi. I work a rotating schedule and would be in country less than 183 days a year, however my wife would be living there full time without working and no income sources. Where does this put me in regards to Mexican income tax liability? I've tried searching the web to no avail. Found all kinds of other tax info but nothing that really matches my situation. Help!!!!


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## TundraGreen (Jul 15, 2010)

jlbenitz said:


> Hi folks. New here so if this subject or something like it has already been posted please point me in the right direction. My wife and I are considering moving to Mexico to attempt to get around some of the US income tax burden on my salary from working in Saudi. I work a rotating schedule and would be in country less than 183 days a year, however my wife would be living there full time without working and no income sources. Where does this put me in regards to Mexican income tax liability? I've tried searching the web to no avail. Found all kinds of other tax info but nothing that really matches my situation. Help!!!!


My first comment is that a forum like this is a not a very reliable source of legal advice. You will get opinions, but opinions are not legally binding nor enforceable in any of the three countries involved. Having said that, I do have an opinion.

Mexico taxes the world wide income of its residents. However, if you will be coming and going frequently, you could enter on a tourist permit each time and would not be a resident. In which case, I don't think you would have any tax liability in Mexico. Tourist permits are usually issued for 180 days. 

However, I don't understand how this plan would help you vis a vis US taxes. Your concern about US taxes implies you are a US citizen. The US taxes world wide income of its citizens. U.S. Citizens and Resident Aliens Abroad. To legally avoid US taxes, you would have to renounce your US citizenship.


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## jlbenitz (Aug 2, 2015)

I know I would still have to file and pay some US taxes but by living outside the US I can exclude almost $200,000 a year in earnings, filing jointly. Another question I would have is whether or not my wife would have to stay outside the US for the same time period as I would to get the exclusion with us filing joint.


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## sixcats (Aug 1, 2015)

jlbenitz said:


> I know I would still have to file and pay some US taxes but by living outside the US I can exclude almost $200,000 a year in earnings, filing jointly. Another question I would have is whether or not my wife would have to stay outside the US for the same time period as I would to get the exclusion with us filing joint.


Check out this area :
Expat Tax - Expat Forum For People Moving Overseas And Living Abroad


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## TundraGreen (Jul 15, 2010)

jlbenitz said:


> I know I would still have to file and pay some US taxes but by living outside the US I can exclude almost $200,000 a year in earnings, filing jointly. Another question I would have is whether or not my wife would have to stay outside the US for the same time period as I would to get the exclusion with us filing joint.


Good point. I know about the exclusion, but wasn't thinking about it when I replied. 

The $200,000 exclusion limit you mention is for a couple filing jointly. The individual exclusion goes up every year and is $100,800 this year.


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## Isla Verde (Oct 19, 2011)

If the OP lives here on a tourist visa, would the IRS consider him eligible for for the exclusion limit?


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## TundraGreen (Jul 15, 2010)

Isla Verde said:


> If the OP lives here on a tourist visa, would the IRS consider him eligible for for the exclusion limit?


According to the IRS web site, one of the criteria to qualify for it is:
"A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months."


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## Isla Verde (Oct 19, 2011)

TundraGreen said:


> According to the IRS web site, one of the criteria to qualify for it is:
> "A U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months."


Thanks for this essential bit of information, TG. So for the IRS, the point is not your legal status in the foreign country, but how many days you are not living in the States.


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