Council tax

I don't know if I asked this in the past or not.....does paying the Council Tax count as Property tax for US taxes? Same question for car registration costs as well.....

Jeez.....I may not have set up my finances in the most cost effective manner (paying higher taxes)....but I can do my US taxes on TurboTax in less than 30 minutes now. Zing!! In 4 more years I think I will be able to go back to the 1040EZ form.

I don't know if I asked this in the past or not.....does paying the Council Tax count as Property tax for US taxes? Same question for car registration costs as well.....

Jeez.....I may not have set up my finances in the most cost effective manner (paying higher taxes)....but I can do my US taxes on TurboTax in less than 30 minutes now. Zing!! In 4 more years I think I will be able to go back to the 1040EZ form.

Council tax is validly a foreign housing cost. It is not however a property tax; rather a tax on the occupation of property.  It cannot be claimed on Schedule A, only on Form 2555.

Council tax is validly a foreign housing cost. It is not however a property tax; rather a tax on the occupation of property.  It cannot be claimed on Schedule A, only on Form 2555.

So unless you have foreign earned income you cannot claim Council Tax as a foreign housing tax?

Zing!! In 4 more years I think I will be able to go back to the 1040EZ form.

From the checklist enabling the use of 1040EZ:

"If you claim a tax credit, you claim only the earned income credit."
and:
"You had only wages, salaries, tips, taxable scholarship or fellowship
grants, unemployment compensation, or Alaska Permanent Fund
dividends, and your taxable interest wasn’t over $1,500."
and:
"If you received interest, you aren't required to file Schedule B"(Anyone with a foreign bank account must complete Part III of Sch. B.)
and:
"You (and your spouse if filing a joint return) were under age 65."

Amongst others.
https://www.irs.gov/pub/irs-pdf/i1040ez.pdf

You may be under 65, but if you're a retired expat, the other 3 may create difficulties.   

I wonder what the checklist will be like if form 1040SR ever comes about?

Yeah.....I probably wasn't going to bother with the extra deductions. Unless there was something pretty obvious that allowed it. I'm getting a fair amount back this year from starting my retirement savings withdrawals. Next year I'm hoping I will eek out a small refund. I stayed in the 15% bracket last year, the next 4 years I will be well up the 25% bracket....the TSP automatically pulls 20% of your money when you take it out.....so they took out way too much last year, but next year will be a different story since a fair amount will be taxed at 25%.

The EZ form probably won't be for me a few years from now like you point out. If I ever get off my butt and stick money in those 1 year fixed bonds that get close to 2% it would put me over the $1500 interest limit. In a way I don't care.....this year TurboTax was so easy I'm getting paranoid about missing something. I haven't completed it yet.....I had my wife sitting next to me for the first time yesterday going through how to use TurboTax and what paperwork etc she needs to get hold of. She took a page of notes. I also showed her again how to get on this site in case of sudden (golf ball to the head etc) death and ask for some pointers from people here.

So unless you have foreign earned income you cannot claim Council Tax as a foreign housing tax?

Would love to have the answer for this question, as we are paying a decent chunk-o-change every month....

Yeah.....I probably wasn't going to bother with the extra deductions. Unless there was something pretty obvious that allowed it. I'm getting a fair amount back this year from starting my retirement savings withdrawals. Next year I'm hoping I will eek out a small refund. I stayed in the 15% bracket last year, the next 4 years I will be well up the 25% bracket....the TSP automatically pulls 20% of your money when you take it out.....so they took out way too much last year, but next year will be a different story since a fair amount will be taxed at 25%.

The EZ form probably won't be for me a few years from now like you point out. If I ever get off my butt and stick money in those 1 year fixed bonds that get close to 2% it would put me over the $1500 interest limit. In a way I don't care.....this year TurboTax was so easy I'm getting paranoid about missing something. I haven't completed it yet.....I had my wife sitting next to me for the first time yesterday going through how to use TurboTax and what paperwork etc she needs to get hold of. She took a page of notes. I also showed her again how to get on this site in case of sudden (golf ball to the head etc) death and ask for some pointers from people here.

The good news is that you won’t be in the 25% for the next few years because the tax reform bill that was recently signed into law simplified it all and reduced the tax bands down from 7 to 7. The IRS has still to release the new rates but they are likely to change from 10%, 15%, 25%, 28%, 33%, 35%, and 39.6% to seven (7) brackets but with slightly different rates: 10%, 12%, 22%, 24%, 32%, 35% and 37%.

After 5 years they are scheduled to reset back to the current rates but you should have done all your withdrawals by then.

Would love to have the answer for this question, as we are paying a decent chunk-o-change every month....

I’m pretty sure from reading the instructions on form 2555 that the foreign housing tax break is for those working abroad. I believe retirees don’t get that break as they only have passive income.

Would love to have the answer for this question, as we are paying a decent chunk-o-change every month....

Generally, it's only of value if your earned income is greater than ~$103,000 per year.

Oh, don't I wish! 

The good news is that you won’t be in the 25% for the next few years because the tax reform bill that was recently signed into law simplified it all and reduced the tax bands down from 7 to 7. The IRS has still to release the new rates but they are likely to change from 10%, 15%, 25%, 28%, 33%, 35%, and 39.6% to seven (7) brackets but with slightly different rates: 10%, 12%, 22%, 24%, 32%, 35% and 37%.

After 5 years they are scheduled to reset back to the current rates but you should have done all your withdrawals by then.

Oh, I've already thought of that one.......I have to thank Trump for something and it irks me to do so. As long as the TSP keeps taking 20% tax on my withdrawals I should at least get some back until I drain the account.