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"How much does traveling cost?"

Cost of living(rent, utilities, wifi, groceries) is $500 USD per month for most countries, $1000 for most others.

"Health care and insurance?"

Health care and insurance are both pennies on the US dollar abroad via medical tourism

"What about visas?"

Usually don't need them, the ones you need are almost all entirely online now, a fifteen minute form and nominal fee that is offset by the drastically lower cost of living in that country.

"How do you make money while abroad?"

Any job that nets you $500 a month works. There are over 2 billion English students globally right now, so native English speakers have lucked into a guaranteed job on or offline.

"What qualifications do I need as an English teacher?"

Some countries and schools require a TEFL certificate or prefer candidates with an associate's degree depending on the position, but if you want to teach English, all you need is to be a fluent English speaker.

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bitofarambler@crazypeople.online

Hey US taxpayers: if you live outside the US 330+ days per year, you don't have to pay federal earned income tax on your first ~126,500 USD each year with IRS form 2555 (infosec.pub)

submitted 2 days ago* (last edited 2 days ago) by bitofarambler@crazypeople.online to c/bitofarambler@crazypeople.online

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IRS form 2555 qualifies you for the IRS Foreign Earned Income Exclusion, and is a simple form to fill out with the rest of your taxes, takes 5-20 minutes depending on how many countries you lived in that year.

IRS form 2555

IRS instructions

This is the official language of the IRS form 2555 physical presence test:

“You meet the physical presence test if you are physically present in a foreign country or countries 330 full days during any period of 12 consecutive months including some part of the year at issue. The 330 qualifying days do not have to be consecutive.”

Plainly, it doesn’t matter if you were absent from the United States between January 1st and December 31st to qualify, it only matters that you were not present in the United States for 330 of 365 consecutive days that include, in some part, the current tax year.

You could have been in the US until april, and then outside the US from May until the following april, and that’s fine to claim the FEIE and exclude a variable amount of your earned income tax as determined each year by the IRS (currently at $126,500 annually).

By tax year(Jan. 1 - Dec. 31) you were only out of the country for 270 days, but out of 365 calendar days, you were out of the country for 330+ days from May to April, and so you pass the physical presence test, which qualifies you for the Foreign Earned Income Exclusion.

It can be a US or non-US company that employs and pays you, you just have to be physically outside the US.

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[–] LOLseas@lemmy.zip 3 points 2 days ago (2 children)

Wow. Big question here: I've lived 330+ days/yr in Europe for the past 5 years, am a US Citizen, and get paid in Euros. My Tax Home is verified as the USA. I haven't filed US Taxes since moving here. My income has been well below $125,000 USD/yr this whole time. Am I to fill this form out using the amount in Euros, per my yearly European country's tax office statements (yearly tax returns), or do I have to backpedal each and convert the Euros to USD? Hope this was clear, pry away. Thanks in advance. LOLseas

[–] killabeezio@lemmy.zip 1 points 1 day ago

You need to file taxes, even if you don't owe anything. That's part of being a citizen of the United States. You really need to reach out to a CPA to file this for you and get squared away. The foreign income tax exclusion just means you don't have to pay taxes in the US under a certain amount. You may still need to pay taxes to the country where you are residing in. This is only with countries where we have an agreement with.

Depending on the state in which your address is in, you may have to pay state taxes. This is not part of the foreign income tax exclusion, that is only for federal.

[–] bitofarambler@crazypeople.online 1 points 2 days ago (1 children)

Have you been paying taxes in Europe while living there?

As far as I'm aware(not an expert, just experienced), you should have been filing your US taxes those past five years, regardless of whether you have to pay any actual taxes or how long you've been out of the US.

Yes, when you fill out 2555, you'd convert your euro income from your pay statements to USD and that would be your reported annual earned income that you enter on your taxes. If it's under 125k and you're outside of the US, you don't have to pay income taxes on any of your earned income.

You'll want to file your US taxes sooner than later if you haven't yet, since living abroad does not exempt US citizens from annually filing taxes, even if you don't need to pay any. If the IRS finds you before you remedy the situation, they get to decide the penalties and fees.

These guys have a pretty good FAQ for US expats living abroad who haven't filed in a while, and it boils down to "file the last 3 years, and the sooner the better".

Don't worry, this isn't an "everything is over" situation, I had to help other expats in the same position who came out okay without significant penalties. Read that FAQ and again, the sooner you catch up on US tax filings, the better. If you only work at a single company and don't have many investments, it won't take very long to fill out and file these forms, which you will be able to claim the FEIE on each year as long as you were outside of the US 330+ days said year.

If you have non-US assets(non-US bank accounts, non-US investments) that cumulatively added up to more than $10,000 USD at any point during the tax year you're filing, you also have to disclose the accounts and amounts to the IRS via the separate online FBAR form here for each year you had more than 10k in non-US assets. If you had more than 10k, the FBAR is required reporting each year just like filing your taxes, and is another better-sooner-than-later thing. The FBAR includes a drop-down menu for "why are you filing late?" because it's so common and you can select "I didn't realize disclosure was required" each year you're catching up on.

Let me know if you want any clarification or have further questions!

[–] LOLseas@lemmy.zip 1 points 1 day ago (1 children)

Thanks so much for all of this!

[–] bitofarambler@crazypeople.online 1 points 1 day ago

You're welcome, have a good one!