will be paid by an American company. Coming back to the US every three months for two weeks. Will I be taxed twice? once in the US and once in Russia?? How does it work?
Other - Taxes - 2 Answers
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1 :
Several issues here: 1st. US citizens are taxed on their world-wide income. 2nd. US citizens may take a credit for taxes paid to other jurisdictions (e.g. Russia - you'll need to research this or discuss with a CPA specializing in EXPATRIATE taxes.) 3rd. HUGE BENEFIT AVAILABLE TO YOU. Make sure you stay out of the US for at least 330 days in the next 365. (Go to Europe or Canada or Mexico or whereever, but stay out of the US for 330 days.) By doing so, you'll have the first $90,000+ income tax exempt. Talk to an EXPAT CPA.
2 :
If you will be returning every 3 months for 2 weeks, you will not meet the physical presence test for the Foreign Earned Income Exclusion. That requires you to be physically present in one or more foreign countries for 330 days out of a full 12 month period. You will be physically present for less than 309 days so you are not eligible for that benefit. You can take a credit for any foreign income taxes paid using form 1116. That will reduce your US tax liability by at least what you would have paid in US taxes on the income. Since you will be working as self-employed, you must pay self-employment tax on the income that you are receiving. You'll file Schedule C to report the income and any business expenses and Schedule SE to calculate the self-employment tax. Form 1116 will reduce your income taxes but will NOT reduce the self-employment tax. You will need to make quarterly estimated tax payments using Form 1040-ES to cover your projected tax liability for the year. It would be a good idea to consult with an expert in expat taxation to properly estimate your US tax liability and make the necessary tax payments on time.
