Author   /   Phil Hodgen

December 6, 2016 - Phil Hodgen

U.S. Estate Tax After Expatriation

Hi and welcome to Expatriation Only, the newsletter devoted entirely to tax problems faced by people who give up their U.S. citizenship or green cards. You watched “escape” movies, right? This is all about the tax hurdles you face when escaping the U.S. tax system.

This episode was written in response to an email I received from reader D.O. Thanks for the questions. (Hint: you, too, can email me and I will answer your questions.)

Estate Tax After Expatriation

Let’s talk about estate tax. This is a tax imposed on what you own when you die. The tax rate caps out at 40%.... continue reading

November 28, 2016 - Phil Hodgen

Claiming the Foreign Earned Income Exclusion for Nonfilers

This discussion is for Americans working abroad who want to claim the foreign earned income exclusion, but they are late in filing the tax return to do so.

The Foreign Earned Income Exclusion

Americans living and working abroad can make up to $101,3001 of earned income tax-free. Earned income is what you get paid for working — wages or self-employment income.

This is the foreign earned income exclusion.2 It is great.

  • Your salary = $100,000.
  • Your tax = $0.

What’s not to like?

You get this tax benefit by attaching Form 2555 to your income tax return.3


People (not you!) have been known to misunderstand the foreign earned income exclusion.... continue reading

Friday Edition
November 22, 2016 - Phil Hodgen

Estate Tax for Noncovered Expatriates

Hello and welcome to Expatriation Only.

Noncovered Expatriates

Noncovered expatriates are people who – when they exit the U.S. tax system can answer “Yes” to all three of these questions:

  1. Is your net worth below $2,000,000?1
  2. Did you, on average over the previous five years, have a Federal income tax liability below $162,000?2
  3. Have you, for the previous five years, filed all of your required U.S. tax paperwork correctly and paid all of your U.S. tax?3

If you answer “no” to any one of those questions, you are a “covered” expatriate.4

Covered Expatriates and Punishing the Iniquitous

This discussion is only marginally accurate for covered expatriates – they face an additional bolus of tax rules designed to punish those who have sinned in the eyes of our Dear Leaders.... continue reading

November 14, 2016 - Phil Hodgen

ACA Solves Banking Problems for Americans Abroad

Americans living abroad have a hard time keeping U.S. bank accounts open.  As soon as the bank (or investment firm *cough* Merrill Lynch *cough*) finds out you are living abroad, you are apt to get your account closed.  

Subterfuge is a common solution.  (Subterfuge is an $11 word that means “tell the bank a lie”.)  You simply report that you have a home address in the United States.  That address happens to be the home of a friendly friend, parent, or sibling.

Now you can do it correctly, courtesy of American Citizens Abroad.

For Americans living abroad, opening and maintaining a US bank account has been a BIG problem.

... continue reading
Americans Living Abroad
November 14, 2016 - Phil Hodgen

NYSSCPA International Tax Conference, 26 January 2017 – I’m speaking about expatriation

Just a heads-up (and shameless promotion) for this upcoming event.  

I am giving a presentation at the New York State Society of Certified Public Accountants’ International Tax Conference on January 26, 2017.  

The topic is expatriation.

Sign up to attend in person or livestreamed on the web.

And many thanks to the Committee (and especially Susan Brown Otto) for inviting me.

I will be in New York for a few extra days, in the name of fun, etc.  My wife is coming with me on this trip.  🙂  She lived in Manhattan for 15 years before moving to California (where I met her) so she takes every opportunity she can to return to NYC.... continue reading

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