Living and working overseas provides opportunities for new vistas, new cultures, great food, more sunshine, and a much lower cost of living. But did you know that it can also provide you with a huge tax beneﬁt? Maybe you are overseas as an employee for a corporation, a local B&B, or even a tour company. Perhaps you operate abroad as an independent consultant, freelancer, or business owner. If you are a U.S. citizen living and working outside the U.S. for most of a year, you may qualify for what’s known as the Foreign Earned Income Exclusion (FEIE). With this, you could completely eliminate your U.S. tax liability.
So you’ve moved overseas to start a new life. Maybe you’ve left an old job and started a new business—and it’s thriving. Perhaps you are finally living the overseas retirement you always dreamed of. But wherever you go, and whatever you do, if you’re a U.S. citizen, you cannot escape your annual U.S. income tax responsibilities. Luckily, filing your taxes from overseas is as easy now as it’s ever been. And you may even qualify for some great benefits by doing it.
I call it the worst law most Americans have never heard of…but you may have heard it called FATCA—the Foreign Account Tax Compliance Act. FATCA demands that every foreign ﬁnancial institution (FFI) in the world turn over account information from its U.S. clients to the Internal Revenue Service. As you can imagine, this can make it difﬁcult for U.S. citizens to offshore their money and keep it safe from the prying hands of the U.S. government.
Among the advantages that Uruguay offers to businesses from around the globe are its various Free Trade Zones (FTZs). FTZs are specific geographic areas within the country that are not considered Uruguayan territory for customs purposes, and where you can avail of important tax exemptions.
Nicaragua is not the first place many people think of when planning a vacation…but things are looking up. There were 1.2 million visitors in 2012, a 14% bump over the previous year, according to tourism officials. And the country has garnered glowing mentions in The New York Times, Travel + Leisure, and other publications.