Here are five key tax tips for US expats living in the Philippines:
1. Utilize the Foreign Earned Income Exclusion (FEIE): US expats in the Philippines can exclude up to $108,700 (for 2021) of foreign earned income from US taxes using the FEIE[1][3]. This can significantly reduce your US tax liability.
2. Take advantage of the Foreign Tax Credit: Any Philippine income tax you pay can be claimed as a credit against your US tax liability on the same income[1][2]. This helps prevent double taxation.
3. Be aware of filing deadlines: While the standard US filing deadline is April 15th, expats get an automatic extension to June 15th. You can request further extensions to October 15th or even December 15th if needed[1][2].
4. File FBAR if required: If you have foreign financial accounts totaling over $10,000 at any point during the year, you must file an FBAR (Foreign Bank Account Report)[1][4]. Failure to do so can result in severe penalties.
5. Consider the Foreign Housing Exclusion: This allows you to exclude certain housing expenses from your taxable income, providing additional tax savings for expats in the Philippines[1][3].
Remember, US citizens must file US tax returns regardless of where they live, so staying compliant with both US and Philippine tax laws is crucial[5]. Consulting with an expat tax professional can help ensure you're taking advantage of all available benefits and meeting all filing requirements.
Can you add any tips?
Citations:
[1] https://www.cpasforexpats.com/post/us-expat-taxes-philippines
[2] https://www.taxesforexpats.com/country-guides/philippines/us-tax-preparation-in-philippines.html
[3] https://protaxconsulting.com/blog/us-expat-taxes-filing-as-american-in-philippines/
[4] https://www.greenbacktaxservices.com/country-guide/expat-taxes-for-philippines/
[5] https://brighttax.com/blog/us-expat-taxes-americans-living-philippines/
[6] https://evolutiontaxlegal.com/expat-taxes-for-americans-in-the-philippines/