Living Internationally

A wise man once said “Nothing in this world is certain except death and taxes.” Since taxes are ubiquitous, and they exist everywhere too, it is always a good idea to do some planning ahead when it comes to taxes. How can you plan ahead for taxes when moving to a foreign country? The agents at Spanish property agency www.valuvillas.com saythe best course to follow would be to seek the counsel and advice from a knowledgeable person, especially one with intimate experience in the country you are planning to move to.

There are some obvious reasons why this would be the best course to follow:

  1. Since allowances, deductions, regulations, and tax tariff structures are so different from country to country, a local expert is most knowledgeable.
  2. How these differences in taxation apply to your unique circumstances is crucial to learn in order to not pay more than your share of taxes, thereby saving you (potentially) a lot of money.

When should this type of tax planning be done? Basically you have three choices: before you move, while you are there, after you start to have problems. It should be obvious that the third option, “after you start to have problems,” is the least likely time to reduce your stress level and reduce the amount of taxes you potentially have to pay.

So the best time to do your tax planning would be before you arrive in the country you are moving to. The next best time would be to engage the services of a local expert not too long after arriving.

One thing to remember that is crucial: as long as you are a U.S. citizen, your tax obligation to the U.S. always comes first. Your U.S. tax obligations follow you wherever you go. For this reason it is often a good idea to have a U.S. tax planner in your Address Book. You know you do not want to get in trouble with the IRS. When the major border crossing in the U.S. swipe your passport, there is the potential that it most likely is being cross-referenced with IRS records too. Make sure you have a good CPA in the States though, since those who are living abroad are often eligible for a rather handsome tax deduction, usually in the range of $80k or so. Now that’s something you DON’T want to miss out on!

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