KANSAS CITY, MO--(Marketwired - April 02, 2015) - According to H&R Block (NYSE: HRB), the world's largest consumer tax services provider, U.S. expats are filing more tax returns than ever before but there are still millions of them who should be filing. While the filing deadline isn't until June 15 for U.S. expats, studies show that more than 4 out of 10 still file in March and April, working to beat the typical April 15 deadline. For those U.S. citizens living abroad, they face three primary concerns this tax season: disclosure and streamlined compliance requirements, Affordable Care Act (ACA) changes and the closure of IRS offices abroad.
"Filing a U.S. tax return while living abroad can be a daunting task, especially with a new health care law in effect and changes to the IRS presence overseas," said Roland Sabates, operations director of H&R Block's expat filing services.
Expats unsure how to use IRS' streamlined compliance programs
The streamlined program introduced by the IRS helps expats who were not aware they had a responsibility to file a U.S. tax return. U.S. expats should understand the eligibility requirements for the program and collect necessary paperwork dating back as many as six years -- sometimes from foreign institutions with different reporting requirements or timelines than the U.S. government. They also should know what tax benefits are available to them as expats, so they do not pay more than they should. No definitive deadline has been established by the IRS and the protection from penalties offered by the streamlined program could end soon.
"The IRS is now actively gathering information about U.S. account holders overseas through FATCA reporting procedures," said Sabates. "But, the IRS also is providing taxpayers with the opportunity to get into compliance. Now is the time to take advantage of the streamlined program."
Affordable Care Act's effects unclear to some expats
one in five respondents in the U.S. unaware the Affordable Care Act (ACA) requires them to get health insurance or pay a penalty, the requirements for expats may be even less clear. However, many expats will be exempt from the ACA's penalty, if they meet one of the following requirements:
- They're a bona fide resident of a U.S. possession,
- They satisfy the bona fide residence test, or
- They are physically outside the U.S. for 330 days of the year.
The exemption will cover many expats, but may not cover those who move to or from the United States during the year because the penalty is calculated on a monthly basis while the exemption takes the entire year.
IRS closes taxpayer-assistance centers abroad
At a time when the U.S. expat faces new questions and rules, the IRS has closed its assistance centers abroad. Taxpayers, who may be seeking additional help, can no longer rely on IRS centers in their area for in-person assistance.
At the same time, in addition to offering assistance over the phone or by email, H&R Block has recently added new expat offices in Sydney and Seoul and is evaluating additional cities where high numbers of expats live. Expats living in Canada also can access certain H&R Block retail offices that specialize in U.S. taxes.
H&R Block's expat services offer expertise, accessibility, convenience
virtual serviceexpats.hrblock.com where they can access expat tax advisors through the virtual service or to find the nearest office.
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