My uncles work overseas and they claim that they do not pay any taxes on earned income, as long as they stay out of the countrey 330 consecutive days. Is this true? They have worked in South America, Russia, Haiti,Marshall Islands etc..
United States - 3 Answers
Random Answers, Critics, Comments, Opinions :
1 :
You can read up on what they are talking about by looking at IRS publication 54. It's not 330 consecutive days, but 330 days out one year living in a foreign country. (The year doesn't have to be 1/1 to 12/31.) Not only must they be outside of the US, but they must actually be somewhere else. Not Antartica, not the ocean, not an oil rig, etc. Keep in mind, they still file taxes and if their income is more than the exclusion, any additional income is taxed starting at 25%. Plus these other countries are charging them income tax.
2 :
Yes it is true i'm working overseas since 13 years and have never paid taxes during this time, but it only works on a expatriate contract if i would work on a local contract i had to pay taxes.
3 :
It could very well be true if they are referring to US income tax. They still have to pay taxes to whatever country they worked in, though, so as to not paying any taxes whatsoever- that wouldn't be correct.
