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How do tax treaties affect my ExPat situation?

Article ID: 47
Last updated: 16 Oct, 2012
Revision: 4
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By Jason Watson ()

The United States has secured tax treaties or conventions with over fifty countries in an attempt to avoid a dual taxation scenario where your foreign income is taxed twice- once by the local taxing authority and again by the United States. Allocation between countries is the underlying theme- everyone wants a slice of the pie from a taxation / revenue generation perspective.

These agreements also preserve several credits, deductions, exemptions and reduced foreign tax rates for United States citizens. In some cases these treaties and conventions can override Federal tax law.

IRS Publication 901 summarizes each tax treaty (riveting information to say the least).

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Also read
item What is foreign earned income exclusion?
item What is the bona fide residence test?
item What happens if my host country has a form of social security?
item If I am a self-employed ExPat, what taxes am I responsible for?

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