Tax software

Hello there,

I am a US Citizen, but have never lived in the US. I realised about 5 years ago, that I should be filling taxes, and have been doing so ever since through an advisor. I am keen to start doing this myself, rather than use the advisor, given the expense. I am quite savey about this type of thing, I do my own UK taxes, but it looks very complicated for the uninitiated! Is there software that anyone can recommend that will deal with forign tax credits etc? I never owe any tax in the US (as my tax from salary and a rental property is higher than I would pay in the USA).

Many, many thanks to anyone who can point me in the right direction.

Ukey

If you go to https://www.irs.gov/uac/free-file-do-your-federal-taxes-for-free you can use the IRS's filters to narrow down your search of online e-filing* companies and choose one that suits your needs.  I used TurboTax to put in all of my details only to find out that my UKC husband's lack of TIN or SSN meant that I couldn't submit my return electronically because I had to hand-write "NRA" (for non-resident alien) into that one line.  Everything else worked fine, but I had to print my return and post it in.

BUT because I explored every option through TurboTax's online software, I was confident in my tax filing arrangement.  So I just downloaded the fillable-PDF 1040A form from the IRS website and filled it out myself (instructions for the form are a separate PDF, with the link usually right next to the form's link), knowing that I was choosing the most advantageous return.  Then I printed it and posted it in.

If you have more than $10,000 (USD as of December 31, 2016 exchange rate listed here: https://www.fiscal.treasury.gov/fsreports/rpt/treasRptRateExch/historicalRates.htm ) aggregate held in foreign (non-US) accounts, you will also have to file the FBAR with FinCEN.  https://bsaefiling.fincen.treas.gov/NoRegFBARFiler.html  No need to register if you're just there to do the FBAR.

There's another form for if you have a lot of assets ($300,000(?) or more), but it doesn't apply to me, and I don't remember what it is.  It's been discussed here in the forum, though.  The IRS and/or your tax preparation software will prompt you if it applies to you.

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This post is really long, but I wanted to reassure you that filing your own return is actually quite easy in many cases.  It takes up some time, but it's not too hard.  Just follow the instructions, and then ask here if you have a question.

This year I filed my taxes with Turbotax, including forms 1116, and it even allowed efiling. I am a us/uk citizen living in the uk.

Hello there,

I am a US Citizen, but have never lived in the US. I realised about 5 years ago, that I should be filling taxes, and have been doing so ever since through an advisor. I am keen to start doing this myself, rather than use the advisor, given the expense. I am quite savey about this type of thing, I do my own UK taxes, but it looks very complicated for the uninitiated! Is there software that anyone can recommend that will deal with forign tax credits etc? I never owe any tax in the US (as my tax from salary and a rental property is higher than I would pay in the USA).

Many, many thanks to anyone who can point me in the right direction.

Ukey

Sounds like you have employment income; foreign employer pension contributions, foreign tax credits, foreign financial assets and depreciation to address.  I would not do this without specialist software.

Many thanks to everyone who responded. guya, when you say I need specialist software, do you mean something like Turbo Tax? I do have all those things you suggest, except possibly depriciation, and I also have rental income. My income is above the "free file" amount. Again, any help / suggestions very welcome.

 jfkimberly, do you think that with the rental income, I would still be able to file myself? Thanks for taking the time to respond!

It is compulsory to claim depreciation & to recapture allowable depreciation on sale. Not claiming depreciation is not a permissible method. You'll need to file Form 3115 to change to a permissible accounting method.

You say an advisor has been helping you with taxes. Did you have the rental income for the past years when the advisor was helping you? Are you sure that depreciation hasn't been included?

Did your advisor file a schedule E? Check to see if there is an entry on the Depreciation expense or depletion line. That is your depreciation. Did your advisor file a form 8582? These are forms I had with my rental property. I also had the tax credits form 1116.

Unless your circumstances have significantly changed year by year, the best way to learn how to file yourself is to study your past returns and use them as a guide. Once you've grasped them, see how confident you are then trying to file yourself.