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If I am earning in USA, but I keep travelling outside USA and

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spend more than 180 days...
If I am earning in USA, but I keep travelling outside USA and spend more than 180 days outside USA, what are the tax implications? I will not have any house/apartment in USA for one year but I will get salary in USA.
Submitted: 2 years ago.Category: Tax
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Customer reply replied 2 years ago
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Tax Professional: Tax.appeal.168, Tax Accountant replied 2 years ago
Tax.appeal.168
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Q: If I am earning in USA, but I keep travelling outside USA and spend more than 180 days outside USA, what are the tax implications? A: Based on the tax laws of the other country, if you are residing in that country, you may be required to pay taxes in that country, even though the earnings will U.S. sourced income. If this ends up being the case, you may qualify to claim the Foreign Tax Credit. Form 1116 is used to claim the Foreign Tax Credit. Link to Form 1116/instructions:http://www.irs.gov/pub/irs-pdf/f1116.pdfhttp://www.irs.gov/pub/irs-pdf/i1116.pdf As far as paying taxes in the U.S., as a U.S. citizen, you will still be required to report the income, even if living in another country. There are specific guidelines for qualifying for the Foreign Earned Income Exclusion. SEE BELOW: To claim the foreign earned income exclusion, the foreign housing exclusion, or the foreign housing deduction, you must have foreign earned income, your tax home must be in a foreign country, and you must be one of the following:A U.S. citizen who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year,A U.S. resident alien who is a citizen or national of a country with which the United States has an income tax treaty in effect and who is a bona fide resident of a foreign country or countries for an uninterrupted period that includes an entire tax year, orA U.S. citizen or a U.S. resident alien who is physically present in a foreign country or countries for at least 330 full days during any period of 12 consecutive months.REFERENCE SOURCE: http://www.irs.gov/Individuals/International-Taxpayers/Foreign-Earned-Income-Exclusion---Requirements Let me know if you require further assistance with this matter.
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Customer reply replied 2 years ago
I am on H1B visa in USA. I am not a US citizen. And yes those countries have Foreign Tax Credit treaties with USA. So based on your answer, here is what I understand
1. Even if I live outside USA, I can continue to earn salary in USA
2. I will have to file taxes in USA (which is OK with me)
3. I may or may not have to file taxes in foreign countries (you will not know the answer and I should check with local tax expert)
4. If I pay taxes in other country, I may (or may not get) some tax credit in USA.Are these interpretations right?Puneet
Tax Professional: Tax.appeal.168, Tax Accountant replied 2 years ago
Hello again, Your interpretations are correct.
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Tax Professional: Tax.appeal.168, Tax Accountant replied 2 years ago
I think you will find the information at the following link beneficial as well. baljeetsinghcpa.wordpress.com/2013/12/24/tax-tips-for-h1b-visa-holders-2/
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