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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Legal
Satisfied Customers: 41220
Experience:  Multiple jurisdictions, specialize in business/contract disputes, estate creation and administration.
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Does tax equalization have to be part of my overseas contract

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Does tax equalization have to be part of my overseas contract before i deploy or can the company get me over seas then implement it mid way in my contract
Thank you for your question. Please permit me to assist you with your concerns.

Tax equalization is a necessity for anyone working overseas. While it is not mandatory, having no tax equalization policy in place can potentially expose you as the employee to factors such as double-taxation (from your current country and the country you are from). Such a scheme should be put in place before the contract begins as otherwise it becomes far more difficult to facilitate midway through your agreement. It is possible, I suppose, but more employers would hesitate as it becomes an accounting nightmare for them.

Good luck.
Customer: replied 3 years ago.
There is no tax in the country of Kwait I have been tax exempt and recived an tax return for the last 8 years I just signed a new contract in jan of this year tax equalization was not in the contract.
Thank you for your follow-up.

While tax equalization is a necessity, it is not a requirement that companies place such clauses in their agreement. If a company does not wish to extend such requirements, they do not have to, as it is typically provided solely as a benefit to the employee. I stand by what I stated that this could be difficult to implement once a contract started, but a company may choose to provide such an option in the midst of an executed agreement. That, however, is fairly unusual. Most employers prefer to provide it from the start.

Good luck.
Customer: replied 3 years ago.
Do they have provide an ammendment to the contract, and can they stop my federal taxed without me signing a form 673
If a modification is offered, it has to come either with an amendment to the old agreement, or potentially a brand new contract outright with this term also defined. But they cannot stop your current withholding and tax review without first having you signed the amended Form 673. That is not permitted as that form is what is used for claiming exemptions.

Good luck.
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