Tax Eclusions

Hello all!  After checking a few pages in this topic I came across an issue that I have a question about.

I am looking into moving to the UK and am curious about the US/UK tax situations.  If I move to and work in the UK will the 330 day tax exemption apply to me?  Just curious because I would hate to have to pay taxes in the UK and then have to fork over more taxes to the US when I am not even living in the country.  I know Uncle Sam just wants his money...but why should I have to pay more to him when I am not even in the country?

Thanx for any info you can offer!

If you meet the requirements of the 330 day test (or the bona fide residence test), you can claim the foreign earned income exclusion.  Otherwise, you can claim foreign tax credits for the UK taxes paid to offset the U.S. tax on your foreign income.

Yes, the Foreign Earned Income exclusion will apply and you will be able to exclude up to $91,500 from your gross US income. In order to meet the 330 days requirements, you can request two extensions totaling 6 months until you meet the physical presence test.

The extension plan will work for you only if you stay in UK for at least a year. If you return to the US before meeting the physical presence test, your only tax relief will be foreign income credit, which will only partially offset your US taxes.

www.taxesforexpats.com
http://twitter.com/taxesforexpats