Question for the Money Doctors

Question submitted on Oct 12, 2012.

Question

I am a US citizen that works for a foreign company. I do not reside in the foreign country that the company operates out of. I reside in the States for the most part. However, I will be receiving payment for my services. I am supposed to be paid in USD directly into my US bank account.

Firstly, do I need to pay US taxes in this situation?

If so, how do I go about doing so?

Please help. Thank you.

Answer

According to our foreign tax expert with our parent company McGladrey & Pullen, LLP, you need to report this income on your personal income tax return.  A company, whether foreign or domestic, should be providing you with a w-2 or a 1099, whichever is appropriate, that you would use to report on your income tax return.  If the company is not appropriately reporting this income to you on a 1099 or w-2, you must still report this income on your personal income tax return.

For additional information visit http://www.360financialliteracy.org/