You could say American expatriates were ambushed in May 2006, when the U.S. Congress passed a new tax law - retroactive to the previous January - that raised the tax bracket on anything U.S. expats earned overseas beyond a fixed amount, and put a cap on expat housing allowances. While some Americans who work overseas and filed U.S. tax returns in 2006 have already felt the pain, it appears that 2007 will be the year of "sticker shock," according to Steven Horton, a certified public accountant practicing in Paris, whose clients include a roster of long-term expats. Horton described a client who is an executive for a large French company and has lived in France for 20 years. As the sole working member of a family with a child and paying child support to a former spouse while earning the equivalent of $195,000, the client has never paid U.S. taxes because his French tax credits canceled out his U.S. obligations. "I had to tell him that next year, for the first time he will have to pay U.S. taxes," Horton said.
You could say American expatriates were ambushed in May 2006, when the U.S. Congress passed a new tax law - retroactive to the previous January - that raised the tax bracket on anything U.S. expats earned overseas beyond a fixed amount, and put a cap on expat housing allowances.
While some Americans who work overseas and filed U.S. tax returns in 2006 have already felt the pain, it appears that 2007 will be the year of "sticker shock," according to Steven Horton, a certified public accountant practicing in Paris, whose clients include a roster of long-term expats.
Horton described a client who is an executive for a large French company and has lived in France for 20 years. As the sole working member of a family with a child and paying child support to a former spouse while earning the equivalent of $195,000, the client has never paid U.S. taxes because his French tax credits canceled out his U.S. obligations. "I had to tell him that next year, for the first time he will have to pay U.S. taxes," Horton said.
sole working member of a family with a child and paying child support to a former spouse while earning the equivalent of $195,000, the client has never paid U.S. taxes because his French tax credits canceled out his U.S. obligations. "I had to tell him that next year, for the first time he will have to pay U.S. taxes," Horton said.
