American abroad? Here’s how using a US tax professional benefits you
4 min readOver several years, there’s been an explosion in companies offering apps and software that allow you to do your taxes, often at a cheaper price than a full-service tax accountant. However, is it the best option, especially for those living abroad in Europe?
With expat tax firm Bright!Tax, we examine why bringing in a tax professional may save you time and money.
You buy yourself time.
As most of us know, US citizens must file their taxes with the IRS on or around April 15th – in 2024, that’s a Monday.
If you’ve recently moved to Europe, you may not know that Americans abroad are automatically granted an extension of two months, to June 15th, mainly so they can take care of their FBAR and FATCA obligations.
Furthermore, an additional extension can be granted to October 15th – something a tax professional can take care of, by supplying forms on your behalf.
While you may be tempted to get your taxes done and dusted by July 15th, life sometimes doesn’t play ball.
There can be circumstances where the documentation you need to file those taxes has yet to be available or experiences delays in getting to you. Many overseas financial institutions don’t operate according to the US tax schedule!
Employing a tax professional to file for you ensures that you have that October extension locked in, giving you more time to have everything you need if you’re hoping to secure a refund.
Emplying professionals to file your US taxes allows you to focus on what’s right in front of you. Photo: Unsplash / Jenny UeberbergYou remain up-to-date
While the world is more connected than ever, and it’s easy to remain in touch with home from abroad, the latest tax information doesn’t always make it to you.
Every year, there are changes to tax legislation – there are changes to tax brackets, the FEIE and more. While there’s every effort made to make Americans aware of this, when you’re living abroad, sometimes you’re primarily focused on adjusting to life in a new country. It’s easy for something very consequential to pass you by,
Did you know, for example, that you can still claim the stimulus payments from 2020 to 2022 if you haven’t already? You also may not be aware that an amnesty program is available if you’ve fallen behind on your taxes.
You gain peace of mind.
When you’re living overseas, it can feel like you’re split between two worlds. On one hand, there’s the life you’ve lived thus far – on the other, you’re navigating a new culture and working environment. Finding your place within it can be not easy and take up much of your time.
Working with a team of US-based tax professionals – Bright!Tax, for example – means that you don’t have to worry about whether you’ve filed everything correctly, covered all your (financial) bases and filed on time. They’ll ask the right questions and give you an overview of what you can expect in return. Though it may cost a little more, oftentimes, the tax savings outweigh the cost of services. And they’re available for a phone or video chat, at a time of your convenience.
Many professionals, such as Bright!Tax, often offer a library of resources that explain changes in tax legislation and the way they work in plain, simple English that you don’t need an accountancy degree to decipher. When you’re pressed for time, having that information can be priceless. It can often help you avoid problems before they happen – particularly in relation to your reporting obligations regarding foreign assets.
Best of all, while you’re effectively getting ‘concierge service’ by employing the services of a tax professional, they always have set fees. That means there’s no unwelcome suprises when it comes time to file.
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