Overseas Tax Question

[mrizzle1991]

Ok so I have been wondering something. I am Born in America/ a citizen there. I have been living in Germany for a year. I have a job in Germany also. so here is my question. I have been making money online in dollars and the money goes to my American Paypal then my American bank account. But i am using that money in Germany also because i am withdrawing it and spending it here. The networks will send me a W9. MY question is do i have to pay taxes in USA and Germany for my online earnings? or just USA taxes?

Also a question for a German, I use the money to also pay rent and school fees. Does Germany have tax breaks for things like that?

Thanks and i hope this is not too confusing lol.

 

[ddarkos]

https://americansabroad.org/issues/taxation/us-taxes-while-living-abroad-faq/

 

[ddarkos]

If you are a US citizen and if you open a bank account in Germany, you will need to sign a Fatca agreement (U.S. individual taxpayers must report information about certain foreign financial accounts and offshore assets on Form 8938 and attach it to their income tax return, if the total asset value exceeds the appropriate reporting threshold.)

 

[bartosimpsonio]

It depends on whether US/Germany have a tax treaty. If they don't then you'll pay in both places.

 

[mrizzle1991]

Thanks for the website link. I just read that i am only required to file if i make $9k or more in a year, this year i wont reach that number as i am only earning 900-1k a month. As for the German account only 300 euros goes in there per month. so i will have to research if i need to fill out a offshore assets form with those earnings.
Thanks for the assistance

 

[burnett4congress]

The US taxes worldwide income. So you'd report your online income plus your German income.

There is a foreign exclusion up to $97,000 depending on how much time you spend out of the country (Form 2555). There is also a foreign tax credit that will give you at least partial credit for taxes already paid on any taxable foreign income you have (Form 1116).

And yes, if you have foreign assets the total more than $10,000 on any day in the year, then you are required to file a FBAR with the Department of Justice by June 30th. Just so, you know, they need to seize your assets someday. If you have over $50,000 in foreign assets, there are additional IRS reporting obligations.

Don't know about German taxes, but most countries in the world do not tax foreign sourced income.

 

[seoChickSA]

Thanks for the website link. I just read that i am only required to file if i make $9k or more in a year, this year i wont reach that number as i am only earning 900-1k a month. As for the German account only 300 euros goes in there per month. so i will have to research if i need to fill out a offshore assets form with those earnings.
Thanks for the assistance

Hi mrizzle1991, I'm a US resident but living in South Africa. I read the thread but still have a question about taxes. This is what I read on the IRS site "
If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. Your worldwide income is subject to U.S. income tax, regardless of where you reside." So my question to you, did you end up filing your US taxes while living in Germany?

 

[ddarkos]

Hi mrizzle1991, I'm a US resident but living in South Africa. I read the thread but still have a question about taxes. This is what I read on the IRS site "
If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. Your worldwide income is subject to U.S. income tax, regardless of where you reside." So my question to you, did you end up filing your US taxes while living in Germany?

You need to do it, any of your employer, bank, insurrance will send data to IRS (FATCA https://www.treasury.gov/resource-center/tax-policy/treaties/Documents/FATCA-Agreement-Germany-5-31-2013.pdf)

 

[seoChickSA]

Thank you for your response, @ddarkos! I take it it's only after I start making over 10K i need to file for taxes, right?