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TexLaw
TexLaw, Attorney
Category: Legal
Satisfied Customers: 4430
Experience:  Lead trial/International commercial attorney licensed 11 yrs
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Hi there, Im looking to speak to someone about a relatively

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Hi there,

Im looking to speak to someone about a relatively simple topic.

I am an American living and working in the Cayman Islands and want to promote supplements online for a US based company. I will be making profits from doing this and getting paid commissions from this company.
My question is as a US citizen working from outside the country how do I pay tax and how much am I required to pay?
And also if it is only me doing this work and getting paid will a sole proprietorship be sufficient to operate under and how do I go about setting this up?

Is this something you can help me with?

Martin
Hi,

Thanks for your question.

This is not as simple a matter as you think, but I will try to give you the simple answer.

The work you are done is done online and is done for a US company. Since you will be paid on a commission basis, your income will be in the US.

Further, even though you live outside the country, as a US citizen you are required to pay taxes on your income world-wide.

Thus, because your income is generated in the US, you will pay US taxes on this on an individual level.

In regard to setting up your business as a sole propreitorship, there is absolutely no paperwork needed to set this up.

How much income do you anticipate being generated from this activity?
Customer: replied 3 years ago.

Probably about 1000usd a month but it could become more like 5000usd a month in the next 6-8 months

At that amount of income, there is no need to incur the extra expenses in setting up an offshore LLC or Inc. It is only beneficial to do this when you are going to earn over $500,000.00, as the compliance costs alone are very high.

So, in conclusion, treat the income as ordinary US income and pay ordinary US income taxes on it.
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