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I am a contractor and work for a US company, but live permanently

in Europe. They send...
I am a contractor and work for a US company, but live permanently in Europe. They send out a 1099 form every year, I pay taxes in the country I live in. The company I work for has decided to use a payroll company. The payroll company will still be using the 1099 form, but they say that I have to provide a US address for the W9 form. They want me to use a relative's address. What are the implications of doing this?
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Answered in 6 hours by:
11/3/2012
Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15,872
Experience: 15years with H & R Block. Divisional leader, Instructor
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Robin D :

Hello and thank you for using Just Answer,
If you use a relative's address you will be subjecting yourself to taxation in the state listed on that address. You would be required to prove to that state, should they assess tax on the income, that you are not a resident. The states, depending on which one, are very determined when a taxpayer uses an address in their state.

Customer:

Florida doesn't have state income tax, but I imagine if I were to put a US address on the W9 form that it could get me in heaps of trouble with the IRS, whether it's a Florida address or any other state.

Robin D :

Not the IRS, because you are required to file and report your income to the federal anyway. You can use the Foreign Income Exclusion or the Foreign Tax Credit but you are still required to report the income if you are a US citizen or Green Card Holder.

Robin D :

If you are not a US person then YES, the IRS would determine taht you are under the taxation of the US should you use a US address.

Robin D :
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Customer:

Okay, so I would be safe if I used a Florida address, since they do not have state income tax. I do file a US tax return every year and use the foreign tax credit thing.

Robin D :

Yes, and thanks for responding

Robin D.
Robin D., Senior Tax Advisor 4
Category: Tax
Satisfied Customers: 15,872
Experience: 15years with H & R Block. Divisional leader, Instructor
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