About Carla Sugarman CPA, Ltd
Carla Sugarman received a B.S. degree in Business Administration from Boston University and an MBA in Finance from the Stern School of Business at New York University. She has been a CPA since 1979 and involved in expatriate/international tax services since 1974 and residing and working overseas for many years. Her clientele includes individuals, professionals, multinational corporations and others.
FAQs
Q. I have been working overseas and heard about the income exclusion abroad exclusion Could you explain it
A. You can qualify for the income earned abroad exclusion by living and working abroad under the bona fide residency test or physical presence test. A bona residency is established by entering a foreign country with the intension of remaining there for an extended period of time, (with your family). In essence you are establishing your home in that country. To qualify, your foreign residency must include a full tax year (January 1 – December 31).
The physical presence test simply requires being physically present in a foreign country for at least 330 days in a consecutive 12 month period.
Q. Do I still have to meet the April 15th filing deadline?
A. The filing deadline is June 15th for individuals overseas. However interest on tax balances due starts accruing on April 15th
Q. What is the foreign income earned abroad exclusion amount for 2009 and 010?
A. $91,400 for 2009 and $91,500. for 2010..
Q. What is earned income?
A. Earned income is income earned in the performance of personal services in employment and or a trade or business.
Q. I am working overseas and qualify for the income earned abroad exclusion but my employer is still withholding federal income taxes from my wages. How do I get my employer to stop this withholding?
A. You can file IRS Form 673 or a duplicate statement requesting this with your employer.
Q. I have been residing overseas for two years and just learned that I qualify for the income earned abroad exclusion . I have not taken it. What should I now do?
A. You could amended your returns for the past two years and elect the income earned abroad exclusion on Form 2555.
Q. I am required to pay foreign taxes in the country where I reside and . Isn’t this double taxation?
A. Yes but you can deduct this foreign tax paid as a credit against your US tax liability in order to avoid double taxation.