Loading...
Tax Services2018-09-14T17:33:13+00:00

Tax Services

Caribbean CPA is a full-service U.S. public accounting firm; specifically designed to serve the tax needs of American Expats living in the Dominican Republic. In order to serve our clients better, we have divided our practice around the tax requirements of a typical U.S. Expat residing in the D.R. Tax Services are designed to take care of your U.S. Federal and State tax filing obligations while making sure you don’t overpay taxes. Our Tax Services are divided in the following three main areas:

cpa
republica dominicana

Tax Preparation Services
___________

Tax Preparation Services are designed to keep you in compliance with your tax filing obligations by preparing your U.S. Federal & State Income Tax Returns BEFORE their due dates.

Tax Compliance Services
___________

Tax Compliance Services are designed to put you back in compliance with your tax filing obligations. Falling out of compliance can happen for reasons beyond your control; the IRS knows it and has designed several programs to bring you back in compliance.

Tax Planning Services
___________

Tax Planning Services is the evaluation of your current financial situation in order to reduce your income tax expense. By being a full-service accounting firm, CPA Samaná can take full advantage of your financial as well as non-financial information to evaluate different alternatives to legally reduce your tax liability.

As a U.S. Expat, you are subject to new tax and financial reporting obligations. However, you are also entitled to special tax benefits, not available to you before. Some of the tax privileges are you are entitled to as a U.S. Expat living abroad are:

1. Foreign Earn Income Exclusion
2. Foreign Housing Exclusion
3. Foreign Housing Deduction
4. Foreign Tax Credit

Foreign Earn Income Exclusion

If you are a U.S. Expat, you will most likely have income from sources outside the U.S. which are subject to tax by the IRS. For example, if you generate income from the Dominican Republic, you will most likely be required to pay income taxes to the IRS based on your income from Dominican sources. This on top of any other income taxes that may be imposed by the “Dirección General de Impuestos Internos” (DGII). However, there is tax benefit called the Foreign Earn Income Exclusion that may exclude up to $102,100.00 of your foreign earnings from being tax by the IRS. To qualify for the Foreign Earn Income Exclusion, you must establish you tax home outside the U.S., and you pass either the Bona Fide Residence Test or the Physical Presence Test. It is very important that you file your U.S. Federal Income Tax Return to claim the foreign exclusion, because, if you don’t, the IRS could deny this tax benefit in the future. If you are not sure whether you are eligible for this tax privilege, please contact us for a free consultation.

Foreign Housing Exclusion

If you are U.S. Expat sent by your employer to an overseas assignment, you will most likely have your housing costs paid by your employer. For example, if your company pays the apartment rent in Dominican Republic while you are station there, your employer is paying your housing costs. This could result in a huge increase in your tax liability, after including as Salaries in your W-2 all the housing expenses paid by your employer. However, there is tax benefit called the Foreign Housing Exclusion that may prevent these housing costs paid by your employer from being tax by the IRS. To qualify for the Foreign Housing Exclusion, you must establish you tax home outside the U.S., and you pass either the Bona Fide Residence Test or the Physical Presence Test. It is very important that you file your U.S. Federal Income Tax Return to claim the foreign exclusion, because, if you don’t, the IRS could deny this tax benefit in the future. If you are not sure whether you are eligible for this tax privilege, please contact us for a free consultation.

Foreign Housing Deduction

If you are a U.S. Expat who happens to be self-employed, you will most likely have established your main residence outside the U.S. For example, if you purchase a home or rent an apartment in the Dominican Republic and this property becomes your main residency, you have established a tax home outside the U.S. These costs could be considerably higher than the housing costs in the U.S., especially if you try to replicate the same standards of living your family enjoyed back in the U.S. However, there is a tax benefit called the Foreign Housing Deduction that may allow you to deduct certain foreign housing expenses from U.S. Federal Income Taxes. To qualify for the Foreign Housing Deduction, you must establish you tax home outside the U.S., and you pass either the Bona Fide Residence Test or the Physical Presence Test. It is very important that you file your U.S. Federal Income Tax Return to claim the foreign deduction, because, if you don’t, the IRS could deny this tax benefit in the future. If you are not sure whether you are eligible for this tax privilege, please contact us for a free consultation.

Foreign Tax Credit

If you are a U.S. Expat, you will most likely pay income taxes to a foreign government. For example, if you work in the Dominican Republic, you may be required to pay income taxes to the “Dirección General de Impuestos Internos” (DGII), in addition to the Federal Income Taxes you have to pay to the IRS. This will result in you paying income taxes to two different countries for the same income, a situation known as double taxation. However, there is a tax benefit called the Foreign Tax Credit that may allow you to claim as a credit on your U.S. Federal Income Tax Return the amounts you paid in income taxes to the DGII. To qualify for the Foreign Tax Credit, you must pay income taxes to a foreign government on income that is also subject to income tax by the IRS. It is very important that you file your U.S. Federal Income Tax Return to claim the foreign credit, because, if you don’t, the IRS could deny this tax benefit in the future. If you are not sure whether you are eligible for this tax privilege, please contact us for a free consultation.

We know how difficult it is to comply with the tax filing obligations of a U.S. Taxpayer living overseas. You ask yourself: am I being punished for moving to the Dominican Republic? These new tax filing requirements are so onerous, it is almost as if I was not supposed to live overseas. That is where Caribbean CPA comes in, because something as mundane as tax compliance has no right to stand between you and where you want to live. Please contact us for a free consultation.

Address
2000 Carr. 8177
Suite 26, PMB 422
Guaynabo, PR 00966

Phone
1 (787) 410-4362

By visiting www.caribbeancpa.com and any of its associated webpages, you are consenting to our terms of service.