Should Expats Have to File Taxes?
One of the things I used to worry about in my moving to Mexico was how to handle my taxes. The typical tax filer spends 13 hours and between $200 to $300 to prepare and file their taxes even on a good day.
The Taxpayers Union says now it takes 85 pages of instructions to explain what the IRS calls the "short form", the 1040A. That's one page more than it took to explain the long form, the 1040, seven years ago. The complexity is expected to get even worse.
Living and working in Mexico creates one more reason to hire professionals, actually two if you consider that you’d rather get back to enjoying the expat life than sweat over missing a deduction.
Almost anyone with a passport is still required to file U.S. tax returns, no matter where they live. Even in a city as big as Denver, there were no local firms that seemed that confident about how to advise me if I lived in Mexico.
I’ve mentioned in previous posts my bad luck with CPA firms (The only time I have been audited was when my CPA was a former IRS accountant) so I know the importance of doing your research before hiring someone to prepare your return. I learned the hard (and expansive) way not waiting until tax time to start looking.
The same goes for considering your expat CPA firm in advance. While I have been associated with Greenback Tax only the last year or so, they seem well-regarded in my conversations with the expat tax consulting community.
David McKeegan, Co-founder, Greenback Expat Tax Services]
Kerry Baker is a partner with Ventanas Mexico which provides insight and resources to people considering expat life in Mexico, including "If Only I Had a Place" on renting in Mexico.
She is also author of the "Interactive Guide to Learning Spanish Free Online," a curation of the best Spanish language tools on the web.