About 9 million US expats live and work in another country but they retain their federal government tax reporting as they retain their US citizenship. With the global pandemic (COVID 19) hit the global economy and after the change in the US government, US citizens living abroad may wonder how the US election will impact expats and taxes. You can expect to have certain change in the expat rules and policies with the win of the democratic party. Irrespective of who wins the US presidency, US taxes will still be a key factor of US expats. US expat tax service providers want to ensure you will always be safe and in good standing with the internal revenue system, thus you don't face unnecessary issues in life. Their tax software makes it simple and easy.
Tax Deadline for Individuals living abroad:
The deadline for filing and pay 2020 federal US tax for US citizens living abroad is June 15, 2021.
There has been thinking whether expats taxes rules will undergo change or not with the claims that new US government will raise taxes. Joe Biden, the newly appointed president of US, does have some good plans to roll back some changes from earlier president ( Donald Trump) signature tax law, jobs act and tax cuts.
The tax cuts and jobs act signed by former US President Trump on December 22, 2017, was one of the most comprehensive and ambitious tax reform bills in the history of America. It provides many US taxpayers and investors with lower taxes and increased incentives to invest in the US. But, the TCJA was controversial due to its favorable corporate tax provisions and estate tax changes, aa a result culminating with several democrats was focusing their 2018 congressional campaigns on repealing or amended the bills.
Joe Biden government wants to double the GILTI (global intangible low taxed income) rate from 10.5% to 21% if you want to register an overseas business with a US parent company. GILTI is a concept from the tax cuts and jobs act and this makes corporate taxable income gets added from overseas income. Also, there are lawsuits against this GILTI tax for US expats being examined.
Also, the new government want to raise overall corporate tax (21% to 28%). The political party doesn't want to repeal citizenship based taxation. The newly appointed US president reached out to democrats abroad that he will work with Americans overseas and address expatriate issues.
The majority of Americans expats won't to see any big changes about US taxes. But, the democratic party has won the US election and so there could be some new rules regarding foreign registered businesses. So, American living abroad must look for advising from professional expat tax individuals to make sure that they avoid penalties, adhere to expat tax laws and file US tax in the beneficial way provided their circumstances.
You must do some research online to find the best US tax advice professional, do not forget to ask your friends and business partners for the same.
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