Expats:Opportunity 4 #FormCrime ! $600 fine 4 FTF 8965-coverage exemption form 4 insurance not available yet taxable! http://t.co/5mS4Y7ztYe
— Patricia Moon (@nobledreamer16) January 17, 2015
Yessiree folks, there is a new form that Americans abroad will be required to file this coming tax season. The Individual Shared Responsibility Provision of the ACA “requires each individual to have qualifying health care coverage (known as minimum essential coverage) for each month, qualify for an exemption, or make a payment when filing his or her federal income tax return.” The forms for reporting coverage, exemptions or making a payment with the federal income tax return can all be prepared and filed electronically.” (of course, expats cannot file electronically).
This is beyond belief! Is anyone in the Congress or the IRS paying attention at all? First, there is a form of insurance for which we are not eligible. Yet, we are liable for a 3.8% tax to fund this insurance from investment income (much of which is likely earned outside the United States). Due to the married-filing-separately option chosen by most since we are married to “aliens”, expats are proportionately more likely to have to pay this tax than Homelanders. And to top it all off, in true American style, if we fail to file this form to receive an exemption for insurance we cannot have yet can be taxed on there is a $600 fine.
Try explaining this to a Homelander! You just cannot make this stuff up!
@GWevil – Striking the IGAs is the first step – no doubt. However in the UK if the IGA is struck down, it’s round two to stop the banks rewriting T&Cs and carrying on with the IRS
Striking down the IGA creates political traction to advance the cause for sure.
I’m just expressing the same thing in different terms.
@ GwEvil, Yes, I did mean RBT. Thanks for getting that and for clarifying what the lawsuit is meant to achieve. Getting rid of the IGA would be awesome! And as Don says, we also need to stop our banks from “carrying on with the IRS” to treat some Canadian citizens differently.
@Don – got it. Ok but in the EU there must be similar banking privacy laws as we have here. It’s no easy matter for banks to get laws altered. Our banks can’t disclose customer data to the IRS as our laws stand now meaning, no IGA no telling IRS squat.
“Americans have the right to be stupid.” (John Kerry)
“Americans have the right to be stupid.” (John Kerry)
And it’s abundantly clear a great many Americans are exercising that right!
How’s this – we have to submit a form to verify that we won’t be participating in a program that we’re not entitled to.
Obama’s arrogant attitude knows no bounds….talk about Kafkaesque…
Wheen you go to a hospital in Canada, Switzerland, or wherever you live, you can just show a photo of Obama and not have to pay, right?
According to one of the speakers at the American Citizens Abroad meeting in London, the 3.8% tax is going to mean that many U.S. persons in London who have not had to pay taxes before due to high British taxation are going to owe the IRS money. For something that they aren’t going to be able to use. Combined with renewed awareness of capital gains tax thanks to Boris, things could start to get interesting.
You guys keep repeating this fallacy. If your paying the 3.8% NIIT (net investment income tax) you’re rich as defined by Obama. You don’t get any benefit from paying this tax even if you live in the states. It’s to pay for other people to get free stuff.
When Obama said he was going to kick you in the pants if you earn more than $200k/$250k (single/married) why did you guys vote for him? Could you not add up or something?
Obama received 95% of the Black Vote, 70% of the women voters and the lions share of the high earning Liberal Vote along with a few White men who usually vote for Conservatives and 70% of the Hispanics whose values always coinsided with right of center voters. That coalition can always elect a president.
I understand the first time, they did it to prove they weren’t anti-black. It is the second time I don’t understand. They should have voted against him to prove they weren’t stupid.
My understanding of the NIIT threshold is that you are deemed to be Saverin-“rich” and subject to the 3.8% NIIT if you “earn” more than (only) $125k and are married filing single.
I reread my statement and still can’t see where I ever said that these people were rich. I only said they were from London (because that is what the speaker said). My point was simply that NIIT and CGT could be galvanizing issues. People who don’t owe U.S. tax because of high British taxes are not necessarily the rich: the 40% bracket in the U.K. starts around $63,000.
If you are subject to NIIT you are rich according to Obama. You by definition don’t get a benefit from paying the 3.8%. The benefit goes to other people no matter where you live.
You said this:
>For something that they aren’t going to be able to use.
By definition you don’t get any benefits from paying the 3.8%. You’re paying for other peoples stuff. I pay for other peoples stuff. I don’t get anything for it and I live in the US.
That would be right because you just halve all your limits by filling singly. You invariably come out worse doing that.
Don’t get me wrong. I think this parallel tax (NIIT) is terrible. It’s a new AMT. It’s not indexed for inflation.
I just don’t think you can complain that you won’t get anything for paying it because nobody gets anything for paying it. I also think it would be a bit rich of Obama voters to complain about it given that he was super clear he was going to screw you before the election.
Is this going through even with a Republican Congress?
NIIT has been in law for a few years. In fact a new 20% capital gains rate starting at $500k is in as well. It’s been passed so long Obama has forgotten he has passed it and has come back to the well a few days ago to raise the 23.8% top cap gains rate to 28%.
Once again, Obama is coming back to beat the crap out of the golden goose, reaffirming the narrowness of the US tax base. It just ain’t gonna work. I know there’s lots of you who dislike these words, but Atlas is/will continue to shrug.That country desperately needs to broaden it’s tax base like via a VAT (Right Wilton Tidwell?).
“Broaden the tax base” – that is exactly what Orrin Hatch said. Seemingly it is what the Republicans want, and most likely what the nation needs. Get rid of all the loopholes that were created by greasing palms.
You know, a young person could go to england between the months of April-September maybe doing some volunteering. All with a six month VISA, be covered by the NHS during that period.
And not qualify for the physical presence test nor the bonafide residence test and still have to pay a penalty!!
Google the following phrase, which is an incorrect (I thunk) interpretation of the affordable care act. US Consulates are showing it, Turbotax help is, even the irs q&a is showing it. Anyways, print out dated copies for friends and family. The beast does not even know their own law.
“U.S. citizens who are not physically present in the United States for at least 330 full days within a 12-month period are treated as having minimum essential coverage for that 12-month period.”
@Stephen Kish Plus the $125 level gets breached more easily if you live overseas as certain investment gains are added on to your income to reach it that would not be considered on similar investments for homlanders in the US. Such as: annual gain on your “unqualified pension” which would be called 401k or IRA in the US (qualified not counted), + PFIC annual gains.
Worse, it cannot have foreign tax credits applied against it, so it is pure, intentional double taxation.
Well, you get to live in a society without untreated consumptives coughing all over the street, if you live in the US. There is an argument to be made that as long as one lives where the NIIT or any other taxes are spent, then one benefits from those taxes, at least indirectly. Which is not true for those of us who live in other societies instead.