Presentations by Jean Mammen, EA

  ,
Comments Off on Presentations by Jean Mammen, EA

In-Person 2017:

Venue:

October 21 and 22, 2017  NYSSEA Annual Conference, Saratoga Springs, NY, October 21 and 22, 2017

Topics:

FBAR and Form 3520: Foreign Account, Gift and Trust Reporting, 2 CE, October 21, 2017

Curing Delinquent International Information Reporting Returns, 2 CE, October 21, 2017

Form 1040NR, Related Forms, and Treaty Provisions, 3 CE, October 22, 2017

October 26, 2017, MD-DC SEA Holiday Inn, College Park, MD, 10 am.

Topics:

Get Income Taxes Right for Visa Holders: Forms, Treaties, Deductions, 4 CE

Presentation Descriptions:

FBAR and Form 3520: Foreign Account, Gift and Trust Reporting, 2 CE, October 21, 2017

U.S. Persons with interests in foreign accounts or trusts, or who receive distributions from foreign trusts or large gifts from foreign persons may be required to file an international information report. Filers need to understand definitions … Continue reading →

Answering the New Q on Form 1040NR Schedule OI, Line 3, By Jean Mammen, EA

 
Comments Off on Answering the New Q on Form 1040NR Schedule OI, Line 3, By Jean Mammen, EA

Line 3 on Schedule OI asks:

Are you claiming treaty benefits pursuant to a Competent Authority determination? Y/N
If “Yes”, attach a copy of the Competent Authority determination letter to your return.

“No” is most likely going to be your answer. But a Competent Authority Agreement (CAA), which sounds similar, just might have been a factor. If so, it could be helpful to attach a statement explaining the facts and circumstances. See China example, below.

If “Yes” is your answer, attach the determination letter. This will have been provided in answer to a request for competent authority assistance, perhaps a ruling, by a taxpayer resident in a country covered by a bilateral income tax treaty. The determination took many months and much effort to obtain. The taxpayer will have the letter.

A U.S. taxpayer would request assistance from the U.S. Competent Authority or the Competent Authority of a … Continue reading →

Visa Type Change: Changing Status, Visa, U.S. Tax Obligation, by Jean Mammen, EA

  , , , ,
Comments Off on Visa Type Change: Changing Status, Visa, U.S. Tax Obligation, by Jean Mammen, EA

Changing Status, Changing Visa, Changing U.S. Tax Obligation

 Part II of III

For a first-time visitor to the U.S., determining U.S. tax obligations can follow a straight path. And the same is true if you have never visited the U.S. See Part I.

If you changed your visa type during your first visit, or if this is your second visit, more possibilities exist, and more analysis is needed.

VISA TYPE CHANGE:  What are the tax and tax residency effects if you changed visa types?

If your new visa allows counting days immediately, you do so.

Example: You had an F1 visa and were still in the eXempt period. You did not count days in the U.S. as days of presence. Now you have an H1b visa. You begin to count days.

 Example: Your new visa is a kind where you can never count days, such as a G … Continue reading →

Second Visit or Multiple Visits to the U.S.: Changing Status,Visa, U.S. Tax Obligations, by Jean Mammen, EA

  , , ,
Comments Off on Second Visit or Multiple Visits to the U.S.: Changing Status,Visa, U.S. Tax Obligations, by Jean Mammen, EA

Changing Status, Changing Visa, Changing U.S. Tax Obligation

 Part III of III

For a first-time visitor to the U.S., determining U.S. tax obligations can follow a straight path. And the same is true if you have never visited the U.S. See Part I

If this is your second visit, or if you have changed visa type, more possibilities exist, and more analysis is needed. See Part II for the effects of visa type changes

SECOND VISIT/MULTIPLE VISITS TO THE US

If you leave the US, and then return on another visit, you must then look back at your past visa history to determine which form to use to report income, 1040NR or 1040.

Q: Were you a tax resident of the U.S. during any part of your most recent year in the U.S.?

Maybe you were gone only a few months, maybe you were outside the US for … Continue reading →

First Visit /No Visit to the U.S.: Changing Status, Visa, U.S. Tax Obligation, by Jean Mammen, EA

  , , , ,
Comments Off on First Visit /No Visit to the U.S.: Changing Status, Visa, U.S. Tax Obligation, by Jean Mammen, EA

Changing Status, Changing Visa, Changing U.S. Tax Obligation

Part I of III

For a first-time visitor to the U.S., determining U.S. tax obligations can follow a straight path. And the same is true if you have never visited the U.S.

If you have changed visa status, or if this is your second visit, more possibilities exist, and more analysis is needed.

FIRST VISIT/NO VISIT: If you have US source income to report, choosing between form 1040 and form 1040NR is relatively simple. Determine if any days you were physically in the US may be counted towards meeting the substantial presence test (SPT).

If you have no visa, or any visa except F, J, M, or Q, or A1, A2, G1, G2, G3, G4, you usually immediately begin to count all days where you spent any time at all in the US.

A common exception to counting days is … Continue reading →

ACA, US Citizens Outside the US, Non-Citizens in the US, by Jean Mammen, EA

 
Comments Off on ACA, US Citizens Outside the US, Non-Citizens in the US, by Jean Mammen, EA

Affordable Care Act (ACA) Health Coverage

Adapted from 4th edition, 1040NR? or 1040? U.S. Income Tax Returns for Visa Holders  +  International Organization and Foreign Embassy Employees., by Jean Mammen. Fourth edition, dated February 6, 2015.  Yes, the 4th edition is now available!

 

Penalty Exemptions

Form 1040 and ACA:

Individuals filing a 2014 U.S. tax return on form 1040 will need either to have minimum essential coverage (MEC) for health care or to show they qualify for an exemption to avoid paying a penalty (shared responsibility payment).

2015 ACA Open Enrollment Extension to April 30: taxpayers who only became aware of the penalty charged for not having 2014 MEC (minimum essential coverage) for health care when they filed their 2014 income tax return have a special enrollment period from March 15 through April 30 to purchase such coverage through a ‘federally-facilitated marketplace’. … Continue reading →

FATCA Comes to 1042-S, then to 1099, by Jean Mammen, EA

 
Comments Off on FATCA Comes to 1042-S, then to 1099, by Jean Mammen, EA

FATCA – the Foreign Account Tax Compliance Act of 2012 is just reaching the tax forms provided to taxpayers. 2013 and 2014 were transitional years. Some 2014 reporting and forms are now FATCA-ready. The full effects for most taxpayers will come with 2015 reporting and forms. A few reporting requirements on financial institutions start in 2016 and 2017.

FATCA’s goal is to increase compliance with U.S. tax laws by U.S. citizens and resident aliens who have accounts outside the U.S., no matter where the account holder lives.  Its provisions also affect people who are not U.S. citizens or residents (called ‘foreign’) who have what may be U.S. source money in accounts anywhere in the world.

What might FATCA bring to forms you see?

– Form 1042-S, Foreign Person’s U.S. Source Income Subject to Withholding, was completely redesigned for 2014.  It now can include reporting required by FATCA or related provisions. … Continue reading →

Green Cards and Wages from an Embassy or International Organization: U.S. Tax Court Explains It All , by Jean Mammen, EA

  , , , , , ,
Comments Off on Green Cards and Wages from an Embassy or International Organization: U.S. Tax Court Explains It All , by Jean Mammen, EA

Sole Abrahamsen, a green card holder, and her husband, Clifford Abrahamsen were the Petitioners in 142 T.C. No. 22, decided on June 9, 2014.

This green card holder and her husband had not declared her wages from work at the Finnish Mission to the United Nations on several years of tax returns. When queried, they claimed the wages were exempt from U.S. income tax under one or another exception.

Green cards holders (resident aliens) are taxed the same as U.S. citizens: gross income “from whatever source derived”, IRC 61(a), minus exemptions, adjustments, deductions, credits or other items allowed in the tax code to determine taxable income and tax liability, as provided in IRC 62, 63, 67, and 68, code sections on credits, and treaties that provide for exemptions. The tax code recognizes treaties as equivalent authority by IRC 894 and IRC 7852(d).

The plaintiffs cited several reasons why the wife’s … Continue reading →

Some child dependents don’t qualify filers for credits, by Jean Mammen, EA

 
Comments Off on Some child dependents don’t qualify filers for credits, by Jean Mammen, EA

Some child dependents don’t qualify filers for credits on Form 1040 or 1040NR. Some children who are not US citizens or residents may qualify as dependents on Form 1040, and even on Form 1040NR for residents of certain countries, without the taxpayer being able to claim certain credits for them.

Dependent exemptions may be claimed for children who meet the dependent taxpayer test either as qualifying child or qualifying relative. The children also either meet or qualify for an exception for other tests: Citizen or resident, joint return, relationship, age, not the qualifying child of someone with a better claim.

The most common barriers to claiming the child tax credit or the earned income credit for dependent children are that the child did not live in the U.S., or was not a U.S. citizen or resident.

Taxpayer Identification Number (TIN) may be another barrier. A child who does not qualify … Continue reading →

READ THE VISA FOR HELP WITH TAX TREATMENT, by Jean Mammen, EA

  ,
Comments Off on READ THE VISA FOR HELP WITH TAX TREATMENT, by Jean Mammen, EA

The schematic of a U.S. entry visa (below) shows where to find information useful in determining the correct tax treatment of the visa holder. (Illustration from the U.S. Department of State website, visa FAQ)

how-to-read-a-visa  First, a puzzling entry: the letter ‘R’ printed below the words ‘Visa Type/ Class.  It does not speak about the visa.  It says the passport is a Regular passport, not one for someone travelling as an Official, or a Diplomat, or a family member of an official or diplomatic traveler. Visa Type/Class is shown to the right of the passport indicator (usually R),  and below the words Type/Class.

The passport in which the visa has been stamped will likely be from the country of citizenship … Continue reading →