Question for the Money Doctors
Question submitted on Jan 21, 2013.
QuestionGreetings from Kuwait!
My wife and I teach Special Needs children at an international school and arrived here in August 2012. As teachers our contract is until August 2013 (teachers'' jobs operate on fiscal year, and not a calendar tax year).
We are paid monthly in our oversea accounts in the local currency.
We worked in the States before arriving here in the Middle East.
We would like to know if we:
a.) qualify for tax exemption status (given that our contract is for 1 year overseas and we will be living for more than 330 days out of the United States)
b.) if not, how much taxes we would owe
Thank you for your time, effort, and energy.
Greetings Amongst other requirements, you would be eligible for the Foreign Earned Income an Housing Exclusion if you spent more than 330 days living abroad during a 365 period. Read through IRS Pub 54 for more information (http://www.irs.gov/publications/p54/ch04.html). I cannot tell you how much taxes you would owe without knowing the details of your situation.
That said, I encourage you to locate a CPA in the US to help since your situation is complex and may require an expert. Visit www.findacpapfs.org to find a CPA you can trust in your area. Good luck!
For additional information visit http://www.360financialliteracy.org/