IL Postcard

Do Expats Pay Taxes?

Date: 03/19/2006

International Living Postcards-- your daily escape

Monday, March 20, 2006
Paris, France

Dear International Living Reader,

I confess to having an aversion to taxes. Not only to paying them--something most of us probably don't like much--but also to spending my time and money figuring out how much I owe and how to file properly. Particularly as a U.S. citizen who lives abroad.

I came up with a solution that works for me: I married an accountant. He may not always have all the answers--as he's not a tax accountant--but his eyes don't glaze over at the mention of the word "tax."

I realize I'm not alone…and, further, that my strategy probably won't work for everyone. Still, please, don't let a tax phobia keep you from making the decision to move abroad.

I wouldn't give up my experiences living abroad for all the tax refunds in the world--and I don't think you should, either. So instead of merely commiserating with readers, we've done something to try to help.

Please accept, with my compliments, our Worldwide Tax Summary.

In this free report, the staff of International Living provide you with a round-up of taxes and current tax rates in some of our favorite destinations: Argentina, Ecuador, France, Ireland, Panama, Honduras, Italy, Mexico, and Nicaragua. Minimizing taxes may not be your top priority as you consider a move overseas, but as a potential expatriate, you should find out in advance about income tax, inheritance/gift tax, transfer tax, capital gains tax, rental income tax, property tax, and whatever other taxes may apply--before you take the plunge into a new life overseas.

Forewarned is forearmed. No, this report doesn't classify as fun reading…but it's free, and I hope it helps as April 15 approaches: Worldwide Tax Summary.

Kathleen Peddicord
Publisher, International Living

P.S. The United States has a very long arm. If you're under the impression that taking your residence, your business, or your investments offshore could keep you out of that arm's reach, then I'm afraid I have some bad news--Uncle Sam expects you, as an American abroad, to file and pay what you owe no matter where you spend your time.

But before you shoot the messenger, you should also know that there are financial advantages to being an expatriate, as well as bona fide ways to save on your taxes. But they are not widely known, even among tax professionals. Trust me, I learned this lesson the hard way--by personal experience.

The free report I include for you here provides a good general overview of overseas taxes. But if you want to seriously look at reducing your tax burden, then you need a serious resource. Again, we can help.

Our brand new 2006 edition of The Expatriate's Tax Bible: The Complete Guide to U.S. and Foreign Taxes for the American Abroad will show you why it's better to be a rich American who collects fine art in France…how you can use a 1031 exchange to save on capital gains taxes for some real estate transactions and not others…why you might want to live in Ecuador or Honduras if you positively hate income taxes…which country gives you a 20-year tax holiday for opening a tourist-related business--even if you earn as much as $10 million you won't pay them a dime of income tax on your profits…which country has abolished inheritance taxes altogether…which levies no taxes on gifts…and much, much more. For full details, see: The Expatriate's Tax Bible.