Oh God my wife is German
Here's our rundown of 5 of the best US expat blogs in 2015. Do you agree?
One - Banker in the sun http://www.bankerinthesun.com
After being robbed at gunpoint outside his home in Florida, Banker in the Sun re-evaluated his priorities in life and decided to pack in the bank job and follow his childhood dream of exploring exotic lands and Arabian kingdoms. He moved to Saudi Arabia, and then Thailand, no longer a banker, but now a self-proclaimed 'digital nomad'. The blog is a blend of his experiences, interviews with other expats, and advice for other would be adventurers. Boasting a massive social media following, the unusual back story alone is enough to merit inclusion on our list.
Two - Oh God my wife is German http://www.ohgodmywifeisgerman.com/
A graphic designer from Portland, Oregan, married to a German who is smarter and better looking than him, responds by blogging about her foibles and English bloopers alongside his general perplexity about German life.
One - Know your responsibilities and filing dates
If you're a US citizen or green card holder, even if you're living abroad, you have to declare your worldwide income, savings, and assets and you might need to pay taxes to Uncle Sam. Any tax due must be paid by April 15th, just like in the US, however the filing date for expats is two months later, on June 15th.
Furthermore, alongside your return, and if you meet a certain dollar threshold (about $10 thousand at any time during the year in total accounts outside the States), you must also submit an FBAR, Foreign Bank Account Report, declaring any overseas bank accounts, and FATCA, Foreign Asset Tax Compliance Act, declaring any overseas assets, (typically starting at around $50 thousand in net value).
Since the FATCA law was passed in 2010, US expats are obliged to declare their foreign earnings and assets, along with their foreign bank accounts. So how should you set about choosing your expat tax preparer? Firstly, go with a specialist. Expat taxes can be convoluted sometimes, especially if there are several years' worth to catch up with for example, and including FATCA and FBAR, compliance can be troublesome. There are a number of online firms that deal solely with expat taxes though, and it makes sense to go with an expert rather than a group with limited experience in this area.
Following the fantastic response to our recent 'Top Five and a Half Things that American Expats Miss from Home' post, and a quick online straw poll, here are our Top Five Things that American Expats definitely DON'T Miss from Home at all.
One - Political Correctness
While Political Correctness might have started out aiming to prevent offence, it got lost, with some people now able to find offence in almost anything. What happened to freedom of speech? Worse still, you have to constantly keep up, as a word that replaced another word that had become offensive becomes offensive itself sometimes almost overnight. It's a minefield, and it's a minefield that most of the world wisely avoids.
Average Americans abroad are getting slammed
The following is an excerpt from 'An American Tax Nightmare', published in the New York Times.
No one likes tax cheats. They should be pursued and punished wherever they are hiding. But recent efforts by the United States Congress to capture tax revenues on unreported revenues and assets held in foreign accounts are having disastrous effects on a growing number of average Americans living abroad ...
Mexico offers personal freedom, low taxes, a relaxed culture
Mexico is the number one destination for US expats. The US State department estimates that there are over 1 million American citizens living in Mexico, and it's easy to understand why. A heady combination of high levels of personal freedom, low taxes, a relaxed culture and a friendly people gives Mexico a wide appeal. Factor in that it's within driving distance of the US, has a lower cost of living (which has a particular appeal to retired Americans, letting their pensions go further), a year-round warm climate, delicious food, and there are lots of other Americans already there, and you may start to wonder why we haven't all moved there.
FATCA (the Foreign Account Tax Compliance Act), made law in 2010, compels US citizens and green card holders to declare their foreign bank accounts, earnings and assets to the IRS each year. It also compels foreign banks and financial institutions that want to do business with the US (so basically all of them) to declare any accounts belonging to US citizens. The idea behind the law was to prevent super-rich individuals stashing wealth abroad to avoid paying tax on it, but in practice the law has affected the 8 million US expats living abroad in unintended ways. Some expats have for example reported encountering difficulty opening bank accounts and getting mortgages, as the burden of compliance for foreign banks has led to them resenting and sometimes denying US citizens access to financial services.
Every US citizen or green card holder is liable to pay US taxes, regardless of whether they are citizens of another country too. This is also true of foreigners born in the US, and children of US citizens born abroad, all of whom are technically US citizens (assuming that they have never officially renounced their US citizenship), even if they have never had or applied for a US passport, or if they haven't even lived in or visited the US in decades.
Boris Johnson, the Mayor of London, was born (to British parents) and lived in New York until be was 5. Never having renounced his US citizenship, over 40 years later he received a US tax bill on the capital gain he had made on a house in London he bought in the 1990s and then sold in 2009. After much deliberation, he ultimately paid up, so as to be able to visit the US again in the future. He later renounced his US citizenship, so as not to receive any more bills.
Caroline Calloway, American at Cambridge
American expats can live incredible lives, and often have incredible stories to tell. New Yorker Caroline Calloway is a mature student studying History of Art at Cambridge, one of the UK's (and world's) oldest Universities. Her Instagram posts about her adventures in the bizarre "Harry Potter-esque" world of the university's antiquated traditions and rituals have gained her a social media following of hundreds of thousands, transatlantic press coverage, and a book deal. The following is an excerpt from ''I feel like I am in Harry Potter: a year in the life of an American studying at Cambridge", published in The Daily Telegraph.
US tax code is 75,000 pages and growing
In the 102 years since the US first introduced income tax, the tax code has 'blossomed' from 400 pages to ... 75,000.
It was during the Second World War that the code first really ballooned, from 504 pages in 1939 to 8,200 in 1945. This was attributed to the complexity of funding the war effort.
The code had expanded to 26,000 pages by 1984, but the last 30 years have been another period of intense growth ...