US Tax Planning /Advising “Remote Workers”, Their Employers & “Digital Nomads” Moving Abroad

Learning Objectives

• To discuss tax planning for clients wishing to explore moving and working abroad.
• To discuss the US tax benefits and burdens associated with overseas work.
• To explain and discuss the nuances of eligibility for claiming foreign-earned income and housing exclusions.
• To identify the tax differences between employees and self-employed and the US tax impact on each when working abroad.
• To identify problems for the employer when remote workers create “permanent establishments” in foreign countries.
• To discuss the tax impact in the foreign country when workers spend time there.

Course Description

Tax pros - are you prepared to advise clients who wish to explore foreign work possibilities? 

So many changes have been wrought as a result of COVID-19, one of the biggest being remote working. As a direct result of the pandemic, people are moving or considering it.  COVID-19 has convinced us that having internet access and a trusty laptop means it is not only possible but very gratifying, to be able to work from anywhere!  Those looking at a residency change are not limiting their options to the various States. Many are looking at a move overseas.  This trend is indeed gaining momentum. Some countries, such as the United Arab Emirates, are tailoring visa programs to encourage remote working professionals to reside there.

Some individuals may make the move as employees of an established company, others as self-employed individuals, perhaps creating a foreign entity to run the business.  

Are you ready to handle the complex tax issues that come with these scenarios?  What if your client chooses to live as a so-called "digital nomad", working remotely from different foreign lands – be it from a short-term rented apartment, hotel room, coffee shop, shared workspace, or airport lounge?  Will the employee's presence in the foreign country drag the employer company into that country’s tax net? Any international move comes with a vast array of complicated US tax issues.

Join this CPE Tax course, Any international move comes with a vast array of complicated US tax issues. My webinar will get you ready to advise your clients who are considering taking the plunge and moving abroad. As a US tax practitioner who has lived and worked abroad for decades, these are issues with which I have incomparable experience. In this webinar, I have discussed the way a professional should approach such as case. It covers the overview of FEIE and FHE - including key basic concepts such as qualification tests, and tax homes with examples. I have specifically highlighted common mistakes and general guidance for such cases. I have also discussed key concepts that will provide you with an important overview and conceptual clarity on key aspects.

This online CPE webinar will cover the following topics:

• “Employee” v. “Self Employed” – critical tax differences and US tax treatment.
• Overview of the foreign earned income and housing exclusions (FEIE/FHE)
• “Tax home” when working in numerous countries
• Traps for the unwary - an “abode” in the USA precludes using the FEIE/FHE benefits 
• Home rented instead of purchased and benefits if any
• Using FEIE/FHE versus FTC and cases of “overlap”
• Tax reporting - Special reporting requirements may come into play when working overseas (FBAR, Form 8938, and numerous other forms if a foreign entity is created to run the business such as Form 926 and 5471)
• Self-employment tax (SE tax) - a rude awakening
• SE tax and totalization agreements 
• Avoiding SE Tax through the use of a foreign corporation – Beware CFC / Subpart F and Substantial Assistance and, of course, GILTI
• Physical presence in the foreign country and becoming a "tax resident"  
• The physical presence of the employee in the foreign country can cause the employer company to be dragged into that country's tax net. 
• State taxes –responsibility for State taxes after having moved abroad; breaking State tax residency with proper planning

Overview

• Overview FEIE and FHE

  4 mins
• What is the "Tax home"

  21 mins
• Home purchase abroad - FHE to the rescue?

  36 mins
• General guidance - FEIE/FHE v. FTC

  47 mins
• Avoiding self-employment tax - How?

  61 mins
• US Tax reporting - Special reporting requirements

  75 mins
• Other considerations for the worker: State Taxes

  92 mins