For most US
expatriates living abroad, the thing furthest from our minds is US tax
compliance. We are residents in a new home, with new friends and new
possibilities. We’re fully absorbed in all th…

For most US
expatriates living abroad, the thing furthest from our minds is US tax
compliance. We are residents in a new home, with new friends and new
possibilities. We’re fully absorbed in all things that are new – and it can be
a formative and life changing experience.

When US expats
think about their lives back in the States, it is often with a mixture of
feelings.  Some of us left to take advantage
of or seek new opportunities. Some left to pursue a relationship. Others have a
sense of adventure that cannot be sated until they ‘know’ – and only they will
know when they’ve arrived at their destination.

And yet, during
this personal and cultural – this life forming metamorphosis, there’s an
element of Americana that remains with you and sorry, but will always remain
with you – you must still file US income taxes. There. It is said. As a US citizen, you must still continue to
file US tax returns.

Why is it that so
many Americans living abroad are behind on their tax filing requirements? The
reasons are varied and nuanced, but breaking it down and compiling all the various
reasons into a few groups, it seems the answers fall into three main categories
– ignorance, fear or rebellion.

–         
Ignorance means you did not know you had to
file. That accounts for a large percentage of the people who are non-compliant.
I remember when I first expatriated to another country I didn’t know. The whole
premise seemed absurd at first. After all, if one is living and working in a
foreign country, paying tax to that country and utilizing your share of that
country’s social resources, it seems counterintuitive that we still need to
ship dollars back home to the US government. For what?

–         
Fear – of having to cross the point of no return –
the Rubicon, into the unknown leads to procrastination and sometimes outright
denial. Procrastination may be tied to perfectionism and the realization that a
situation – our tax situation, seems beyond our control. Those in denial may pretend
that maybe the problem will just go away or it’s easier not to think about it.
These are primal emotions and can be very upsetting.

–         
Rebellion against the system plays a part in
why some Americans refuse to file their US taxes. To them it is an affront to
their liberties, their personal freedom, particularly because they no longer
even live under the jurisdiction of the United States. They absolutely refuse
to comply with the mandate to file their US taxes. Rebels are often not able to
separate their feelings about the government from their legal obligation. It is
after all the law that all American citizens are bound by.

What is the
outcome for those American expatriates who either don’t know, procrastinate, or
flat-out refuse to file their US income taxes? 
Eventually, nothing good. Ultimately, it all falls down. The reality is,
one’s better off filing a return – any
return that could just as well be written in Greek than not filing a return
at all. Doing nothing is the worst thing because, sooner or later, the IRS will
locate those who are non-compliant and assess them and open their lives to be
read like a book – and it’s a story that can seem endless and quite painful.

This can all be
alleviated though, and not with terrible difficulty. Just as the US now employs
high tech methods for pinpointing non-compliant Americans abroad, there are any
number of high tech resources available to get the help one needs. There are
tax services online that specialize in US expatriate tax preparation and
they’re expert at guiding you through the process of bringing yourself fully
into compliance with the IRS. Whether for ignorance, fear or rebellion, the
smart play is to get right with the US government and to do it soon. Choosing
to make a bit of effort now, even if somewhat uncomfortable, will surely save a
world of pain later.

Source: Free Articles from ArticlesFactory.com

ABOUT THE AUTHOR

Bright!Tax is the
go-to cloud based US expat tax
preparation firm most sought after by the 6 million Americans who are living
abroad. All CPAs. Fanatical support. Exacting methods. Easy and Precise.  http://www.bright-tax.com