A Tax question

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xiaopipi

New Member
I was offered a job by a company in my home country. My country will deduct the tax from my salary. I have a GC and would like to maintain it. I guess I still need to file tax as a resident.
1. How should I file the fedreal tax?
2. Do I still need to file state tax? My wife will stay in California for the first year and we have a house in CA.
3. Should I pay social security and medicare?
 
A limit

Is there a limit that I don't need to pay the tax if my salary is under it? My country already deducts the tax from the salary.
 
xiaopipi said:
Is there a limit that I don't need to pay the tax if my salary is under it? My country already deducts the tax from the salary.
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There is, but it's pretty low. If you are already taxed then you claim a foreign tax credit against your US liability. Not declaring the foreign income is illegal and stupid.
 
xiaopipi said:
Is there a limit that I don't need to pay the tax if my salary is under it? My country already deducts the tax from the salary.
Click to expand...
If that country's tax rate is higher than the US tax rates for your level of income, you probably won't have to pay any US Federal income tax. But you'll still have to report your non-US income on the US tax return, and do the calculations based on the applicable tax treaties and credits and deductions to figure out how much US tax you owe, if any.
 
Just a note.

It is often tempting to use the Foreign Earned Income Exclusion (FEIE) to simply exclude one's foreign wages (under ~US$80K) on Form 2555. However, to use this in is, in essence, stating that they have either made a new home outside US or have spent so little time in US (less than 30 days per year), that they should be allowed to exclude their wages.

While it is permissable to use this, it does give rise to the situation where one is telling one govt agency (IRS) that one doesn't live in US, and another (CIS) that one does.

That is why, as TRC sez, using the Foreign Tax credit (FTC) method with Form(s) 1116 is the safer way to go. the return is MUCH more complicated this way however.

If you are living or working in a no or low tax country however, the FTC route gains you nothing, and one would then have to weigh the risks to use FEIE.

As to state tax, again as TRC stated, state tax residency rules would apply. Each is slightly different.
 
TheRealCanadian said:
There is, but it's pretty low. If you are already taxed then you claim a foreign tax credit against your US liability. Not declaring the foreign income is illegal and stupid.
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I think claiming foreign tax credit depends on whether the country has a tax treaty or not. You should check on this depending on your country.
 
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