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Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 13561
Experience:  15years with H & R Block. Divisional leader, Instructor
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Hello, I was born in USA so I am a US citizen but I leave

This answer was rated:

Hello,

I was born in USA so I am a US citizen but I leave permanent in Greece. I am a merchant marine officer and I got a job offer from a US company with Bahamas flag ships. They ask from me my Social Security number but I don't have one because I left very young from US. If I apply for my SS# XXXXX I get the job will I have to pay some taxes and fees to USA?

Look forward for your answer.

Robin D :

Hello and thank you for using Just Answer,
A US citizen is required to report their worldwide income. They are also allowed to use the foreign earned income exclusion and the foreign tax credit to assist them.

Robin D :

Your foreign income can be excluded form your US taxes but only if you file a US tax return.

Customer:

what do you mean file a US tax return?

Robin D :

Every US citizen is required to file a US tax return each year and report their income. If you earn less than the amount for personal exemption and standard deduction then you are not required to file.
If you are a U.S. citizen or a resident alien of the United States and you live abroad, you are taxed on your worldwide income. However, you may qualify to exclude from income up to an amount of your foreign earnings that is now adjusted for inflation ($91,400 for 2009, $91,500 for 2010, $92,900 for 2011, $95,100 for 2012). In addition, you can exclude or deduct certain foreign housing amounts.

Robin D :

A short answer to your initial question would be yes, you are going to be taxed by the US. But the longer answer is that you were under US taxation anyway.

Customer:

the company told me "taxes will be deducted automatically on board, at the end of the year you will receive W-2 form and you will pay your share if this will apply to you. The amount to be deducted is calculated on board ( payroll system)" this means that from the salary I was told that I will receive they will give less when they will deduct the amount and after that I will have to pay more if that will apply to me?

Robin D :

Yes that is the way that withholding works. The US is on a pay as you earn system. This is done by having the payer withhold at the source. Then you will be required to file a US tax return.

Robin D :

You were supposed to be filing US tax returns any way if you are a US citizen.

Robin D :

You report your worldwide income on the return and then you can show that you earned it while in another country and you are allowed to exclude the amounts I mentioned earlier.

Robin D :

But you cannot take advantage of the exclusion if you do not file.

Customer:

I don't file any tax returns until now. I never worked in US and I left at the age of 6 and I have never been in US since then.

Robin D :

If you are a US citizen then you are under US taxation. The US is not a country that goes by residency for Citizens. Some countries do but not the US.

Customer:

so I have records in US taxation even if I have never file any tax returns until now, I will file and if I cover the requirements for tax free incomes I will not have to pay anything but the company will have to keep some money from my salary for the taxes.

Robin D :

If you meet the requirements to exclude (be outside the US in another country all year) you can exclude up to the limits each year. You still have to file though to do this.
If the company withholds too much to cover your true US taxes owed, the US tax agency (IRS) will refund the over held amount to you.

Robin D :

I know this is a lot to take in.

Customer:

to file should I be in US or I can do it from Greece?

Robin D :

Taxes or to get the SS#

Customer:

taxes I know to get the SS# XXXXX can do it at the Embassy.

Robin D :

YOu do not have to be in the US to file your tax forms. You can do it online using a tax servcie program (TaxAct, TaxSlayer,TurboTax to name a few.).

Robin D :

Or you can use the IRS.gov site and get the Form 1040, Form 2555, and the Form 1116

Robin D :

The 1040 is the standard form, the 2555 is for excluding income, and the 1116 is to claim a tax creidt if another country taxes you on the same income.

Customer:

will I be asked to prove that I pay taxes at an other country if I want to be excluded?

Robin D :

You would only exclude if you are outside the US. Your mailing address and personal info entered on the tax form would show you are outside the US plus the company info (your employer would have proof).

Customer:

and what is the % that the company will keep from my salary? if you are able to estimate.

Robin D :

That will depend on your income and how many allowances you claim. The company will have you complete a W4. This form will show how much you would have withheld. On the W4 you signup as single or married and show how many dependents you have. Then the % is lowered for each allowance you claim.

Customer:

so if I am with the ship in US port it will count like I work in US or because the ship has Bahamas flag it won't count?

Robin D :

It will count against you for excluding every day you are not in another country or in US waters.

Robin D :

You need to spend no more than 30 days in the US or in US waters.

Robin D :

A year

Robin D :

This is so you can exclude the full amount each year.

Customer:

if I am excluded it means that I will have no medical insurance and no retirement pension from US goverment is that correct?

Robin D :

No, for tax purposes it only means you can exclude from your taxable income a large amount so you are not taxed on that amount.

Robin D :

Example:
You worked for this company in 2012 ans were paid $95,000. Because you were not in the US and worked in another country all year you would file the 1040 and report the $95,000 but then you attach the Form 2555 to the 1040 and list that you were in whatever country (Greece) and subtract (exclude) the $95,000 form the taxable income on the 1040 form.

Customer:

without paying any taxes for my income I will still have medical insurance and retirement pension?

Robin D :

If your company offers it.

Robin D :

Now if you mean Social Security and Medicare, those are not tax area questions except that you will have amounts withheld (all US citizens do) and then you can apply when you reach a certain age.

Robin D :

I hope I have been able to address your original question "If I apply for my SS# XXXXX I get the job will I have to pay some taxes and fees to USA?"

Customer:

ok thank for your service.

Robin D :

Your positive rating is always thanks enough.

If you could also participate in the very short survey that Just Answer will send you by e-mail I would appreciate that very much.

Robin D :

Please come back if you have any other questions about taxes

Robin D. and other Tax Specialists are ready to help you