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MequonCPA
MequonCPA, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2342
Experience:  CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
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I am a aUS citizen working for a German company but living

Resolved Question:

I am a aUS citizen working for a German company but living in the US. I get paid in Euros deposited to a German bak account and transfer those funds to the states. I dont pay taxes since i live in the U.S. but i am required to pay taxes in the US.

How do i declare?? Do i pay taxes to the state of CA as well??
Submitted: 6 years ago.
Category: Tax
Expert:  MequonCPA replied 6 years ago.

Dear 92jwv3yi -

 

As a United States resident you are taxed on your world wide income from whatever source derived unless specifically exempt by the tax code.

 

Your German income is taxable in both the United States and the state of California (if you are a CA resident). You are allowed a credit on your federal return for foreign taxes paid, if any.

 

I can't specifically tell, but it appears that you are self employed. As such, your income, less allowable expenses will also be subject to self employment tax.

Customer: replied 6 years ago.

Actually i would work for a German company called RapidEYe.

 

What kind of documentation would i need to present at the time I declare taxes?? What forms would I submit?

 

I guess im better off moving to TX or FL to avoid state taxes....

Expert:  MequonCPA replied 6 years ago.
Are you paid as an employee or an independent contractor
Customer: replied 6 years ago.
employee
Expert:  MequonCPA replied 6 years ago.

Dear 92jwv3yi -

 

If you are an employee you will include your income as wages on your Form 1040. You will need to attach a statement to your return showing the earnings amount in Euros and the conversion of that amount to dollars.

 

Because there is no federal or state tax withheld you will need to make estimated tax payments quarterly to avoid underpayment penalties.

 

Yes, if possible, you may want to consider moving to a state that does not have an income tax. Texas and Florida are two, there is also Nevada, Alaska, South Dakota, Washington and Wyoming.

MequonCPA and 2 other Tax Specialists are ready to help you