Hi
@BrisOC22
I thought I’d jump in as I’m a DV2021 who moved here in October last year, and had to face these issues as my Australian company also allowed me to stay with them and work remote. There is good and bad and as advised by others you need to get tax advice from someone who knows both spaces (US Tax and Australian). What I’m telling you is just based on my own experience.
I’m still an employee of the Australian company, and everything for me is Australian based (pay, benefits, taxes etc). I haven’t had to do or set up anything special over here, but as a US permanent resident it all has to be declared in my annual taxes (recently done).
Taxes
There is an agreement between Australia and the US with regards to federal income tax, so this part is great as you won’t get double taxed, however in Australia we pay higher taxes, if you get a US job your tax rate will be better.
The problem comes with state income taxes (and in some places city income taxes). There is no agreement, so if you reside in a state that has state income tax get ready for a bill come tax time. I believe only 9 states have no state income tax.
This was a major issue for us. When we had our taxes done earlier this year (for 2021), nothing was owed for Federal income (due to the agreement), however as we settled in Los Angeles (California has state income taxes), we would normally owe an extensive amount. We kind of knew this coming, but didn’t expect it to be so much. Thankfully as we had only spent under 3 months in California for 2021 it wasn’t that much of an issue this time, but were advised if we stayed then come 2023, we would have a large state income tax bill for 2022. We were advised to either move to a state with no state income tax or find US jobs.
At this stage our wages, perks and benefits of our Australian jobs is too much to give up so we moved to Florida early this year (Florida has no state income taxes).
Health Insurance
You will need proper health insurance, people end up medically bankrupt. If you’re working remote for your Australian employer then they most likely won’t be paying for a plan for you. You will need to sort this out yourself. It’s expensive. We used a broker to find the best insurance for us, it cost us just under $1,000 USD a month (as a couple). When we moved over to Florida we had to do it all over again as your coverage doesn’t simply transfer states.
You really have to weigh up if working remote for a foreign company is worth it for you and the downsides that come with it. You’ll also still have to do your Australian tax returns.
We had to go to an expert as it was just too confusing with Federal taxes, state taxes, foreign investments, superannuation etc. and we’re thankful we did. People over here will tell you it’s easy to file on your own but they’re not in the same situation, it’s much better to have an expert do it.
We originally settled in LA as we loved it there, however having moved to Florida now it was definitely the best decision we made and it wouldn’t have happened if it wasn’t for the tax situation. In Florida our health insurance costs were also cheaper and overall cost of living is cheaper so can’t complain.
Good luck!
Also good luck to everyone getting their transfers to Suva, it’s nice to read.