Riverside Expat Tax Attorney

Tax returns are a complicated process, made more difficult when you are a U.S. citizen or Green Card holder who lives and works abroad. Collecting all the necessary financial information and preparing your tax return in time to meet the deadline while also ensuring compliance with IRS standards as well as the standards of your country of residence is difficult for even the most experienced tax filer. Filing from abroad is riddled with legal and financial intricacies, all of which can be made easier for expats by working with an experienced professional. The Evolution Tax and Legal team of Riverside expat tax lawyers is here to provide you with the guidance and experience to make this tax season as seamless as possible.

Why Hire Evolution Tax and Legal for Your Expat Taxes?

The team at Evolution Tax and Legal offers a unique skill set: our team consists of dually-license attorney-CPAs. As such, we can provide you with the expertise of an accountant while having the background knowledge of an attorney. This is especially important when working with the intricacies of international taxes. When working with the team at Evolution Tax and Legal, you can expect:

• The knowledge and experience of an attorney come together with the expertise of a CPA to provide the best international tax accounting, legal, and advisory services.
• An online process that has been specially designed to serve individuals living and working abroad: our streamlined process allows you to easily work with our team of experts in Riverside, no matter the time zone you are located in.
• A team of experts who have experience in the intricacies of international tax. Our team has served clients worldwide, both individuals and businesses, and we have experience working in a variety of situations. Whatever your tax situation is, we have the background and expertise to work with you.

Our team’s ability to bring you the services of tax attorneys and CPAs under one roof allows us to offer savings and expertise that other firms cannot. We bring together a team that has the background and experience of a Big 4 accounting firm with the attitude and customer service of a small business. We are excited to welcome new clients and show them the transparency, openness, and responsiveness that our company is built on.

Expat Tax Services We Offer in Riverside

Whatever your tax needs are, our team is ready to work with you. Our services include:

• U.S. Federal Tax Return Preparation: Our Riverside-based tax attorneys will work with you to ensure compliance with IRS tax standards by helping you collect all necessary financial information and file your federal income tax return by the deadline.
• State Tax Returns: Some individuals living and working abroad may have certain financial or residential ties that will require them to file a state tax return. If this is necessary for you, our team can help you gather the necessary information and file this state income tax return.
• Tax Planning Analysis: Our team of tax experts will conduct a tax planning analysis to ensure you are saving the maximum amount on your income tax return. We will work with you to implement a savings strategy and ensure short-term and long-term savings.
• Federal and State Audit Representation: Our team offers federal and state audit representation for both individuals and businesses facing an audit process.
• Non-Filers and Delinquent Filings: Failing to file taxes or filing incorrectly can seem daunting, leading many individuals to avoid the situation until it becomes a larger problem. Our team can offer services to seamlessly rectify any non-filing or delinquent filings and ensure you are once again in compliance with IRS tax standards.
• Reviewing Prior Returns: Mistakes are common when individuals file their own taxes. Our team will review your prior tax returns to determine if mistakes have been made and how they may be rectified and avoided in the future.

How Do Expats File Taxes?

The U.S. is unique in its tax requirements, being one of the only countries to tax based on citizenship, regardless of where an individual resides. This means that any and every U.S. citizen or Green Card holder is required to file some form of federal income tax return with the IRS annually, even if they live or work abroad. Some states may require individuals in certain financial situations to file a state income tax return in addition to their federal income tax return. U.S. citizens will be required to pay income taxes on both earned and passive income they have accrued throughout the tax year if they meet a certain threshold, even if this income was earned in a foreign country or through a company that is not located within the U.S. This includes any wages earned, any income earned from investments, rental properties, and retirement plan payments, as well as reporting information from foreign accounts and foreign assets.

Do Expats Pay Double Taxes?

Tax treaties have been put in place between the United States and many countries worldwide, serving as requirements and guidelines for individuals living and working abroad on which country they are required to pay certain taxes to. These treaties help U.S. citizens and Green Card holders living and working abroad avoid double taxation. Tax treaties may vary from country to country and are riddled with jargon and complex information that is difficult to decipher without assistance. It is important to review the tax treaty for your country of residence to ensure compliance with U.S. tax standards as well as tax requirements for the country of residence. Working with a tax professional to understand the treaties and intricacies of tax compliance will help ensure you are avoiding double taxation.

When To File Taxes as an Expat

Expatriate taxes follow a similar timeline to tax filings completed in the United States. The tax year follows the calendar year, starting on January 1 and ending on December 31. Taxes will be filed in the following year. Taxpayers must pay all taxes by April 15, but expatriates get an extension on filing their tax return. Expats must file their tax returns and any additional forms by June 15 in order to comply with the IRS guidelines.

FBAR Filing

It is highly likely that, as an expatriate living and working abroad, you will hold some amount of money in a foreign bank account. Whether this is an account in your country of residence or an offshore account, you may need to file a form to share this information with the IRS. Any individual who holds more than $10,000 at any point throughout the year in a foreign or offshore account is required to file an FBAR, which is a form that helps the IRS ensure tax compliance with individuals who hold money outside the United States. The FBAR, or Foreign Bank Account Report, is to be filed alongside the federal income tax return each year. Along with the FBAR, you will be required to file FinCEN Form 114. Both of these forms are due by April 15, along with your income tax return, but similar to the income tax return, individuals are given an automatic extension to October 15 to file these forms. If the deadline is missed due to taxpayer negligence, financial penalties could be incurred.

FATCA Filing

Individuals who hold more than $50,000 in foreign assets or property at any point throughout the tax year will be required to file Form 8938, the Statement of Specified Foreign Financial Assets. This form is to be filed with the federal income tax return and is required by the IRS to help the government keep track of foreign assets held by U.S. citizens and Green Card holders. If you do not meet the income tax filing requirement but still hold more than $50,000 in foreign assets, it is not required for you to file Form 8938. It is important to consult with a tax attorney prior to deciding not to file any foreign tax forms, as penalties for failure to file can be costly.

FBAR, FATCA & Offshore Disclosure Obligations for Expats

As discussed above, U.S. citizens and Green Card holders have an obligation to disclose certain offshore accounts, foreign bank accounts, and foreign held assets to the IRS each year when they are filing their federal income tax returns. The requirements for filing an FBAR and filing FATCA vary depending on the individual, but in general, you can assume that if at any point throughout the year you held more than $10,000 in a foreign bank account, you are required to file an FBAR, and if at any point throughout the year you held more than $50,000 worth of foreign assets, you are required to file Form 8938. Complying with the filing requirements for FBAR and FATCA is important, as failure to file or delinquent filings can come with hefty financial penalties.

Common U.S. Expat Filing Mistakes in Riverside

Over the years of working with expatriate tax filings, we’ve noticed common mistakes that individuals will make when independently filing their taxes. While these mistakes may seem small, they can cost taxpayers a lot of money over time. Our team works with expats to rectify these mistakes and develop strategies to avoid them in the future, ensuring compliance and tax optimization strategies. Some of the most common mistakes include:

• Failure to include Form 2555 or Form 1116 in your filing: The Foreign Earned Income Tax Exclusion Form, Form 2555, helps determine how much of your foreign income is to be excluded and determines your residency through the bona fide residence or physical presence test. Form 1116 is the form required to claim a foreign tax credit. Failure to file these forms can work against you and have you paying higher taxes than necessary during tax season.
• Failure to claim the child tax credit: Claiming your dependents on your tax filings is a great way to save money, and failure to do so will result in you paying additional taxes where you could be saving.
• Failure to file an FBAR with your tax return: The FBAR is a required form for individuals holding more than $10,000 in foreign bank accounts throughout the tax year. Failure to include the FBAR if it is required can result in large penalties or fees, costing you a large sum of money in the long run.
• Failure to file an extension past June 15

What Happens if You Don’t File Taxes While Living Abroad?

There are significant penalties for individuals living and working abroad who fail to file or have delinquent filings. These include hefty penalties and potential prosecution.

Neglecting to file your income tax return on time can result in three different types of penalties, depending on your situation. Failure to file is the most costly penalty and will result in a fine of 5% of the amount of money you failed to file taxes on, with an additional 5% penalty added for each month that you failed to file. The maximum penalty is 25% of the taxes you owe, as well as paying the full amount of taxes. Failure to pay is lower in comparison, but still costly. This results in 0.5% being owed, and this also increases by 0.5% monthly, but this penalty can also add up over time if a taxpayer does not take steps to get back into compliance with taxes. The third type of penalty will be missed payments, which will accrue interest over time. Failure to file FATCA or FBAR results in even more costly penalties. Failure to file FATCA can result in a $10,000 fine, and failure to file FBAR can result in a maximum of an $87,000 fine.

Working with an expat tax attorney can be an easy way for you to ensure taxes are filed properly and avoid paying any unnecessary fines for delinquent filings or failure to file.

Schedule a Free Consultation With a Riverside Expat Tax Lawyer Today

Our Riverside expat tax lawyers are prepared to provide you with the guidance you need to not only make your tax season much easier but also provide tax optimization strategies to help you save money. It is never too soon to start preparing your tax filing plan: Schedule a consultation with the Evolution team today to learn more about your unique tax situation and discover how our team can help.