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Wed Jan 16, 2013, 12:04 AM

U.S. expats in Canada face new Obamacare health care tax

Source: The Globe and Mail

The roughly one million Americans living in Canada have another reason to fear the U.S. Internal Revenue Service: a new U.S. health care tax.

... The problem arises because, under U.S. law, Americans must file tax returns every year with the IRS, regardless of where they live and work.

These people typically do not owe any U.S. tax if they live in a country such as Canada, where taxes are higher.

The catch this time is that people will not be able to offset the new tax by applying foreign tax credits because of the way the U.S. law was drafted, tax experts warn.

Read more: http://www.theglobeandmail.com/report-on-business/international-business/us-business/us-expats-in-canada-face-new-obamacare-health-care-tax/article7372249/

7 replies, 1185 views

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Reply U.S. expats in Canada face new Obamacare health care tax (Original post)
Newsjock Jan 2013 OP
marybourg Jan 2013 #1
defacto7 Jan 2013 #2
bigapple1963 Jan 2013 #3
laundry_queen Jan 2013 #4
Art_from_Ark Jan 2013 #6
laundry_queen Jan 2013 #7
Art_from_Ark Jan 2013 #5

Response to Newsjock (Original post)

Wed Jan 16, 2013, 12:08 AM

1. Bring on

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Response to Newsjock (Original post)

Wed Jan 16, 2013, 12:50 AM

2. So, is there a problem here? n/t

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Response to Newsjock (Original post)

Wed Jan 16, 2013, 12:56 AM

3. why is the us

 

the only country with citizen based taxes? as a matter of fairness, what kind of services does the federal govt provide if you don't even live within the borders?

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Response to bigapple1963 (Reply #3)

Wed Jan 16, 2013, 01:06 AM

4. Question

so, as I understand it, US citizens pay taxes to the gov't regardless of where they live, unless they are in a country with which there are tax treaties. So do 'residents' of the US, who are not 'citizens' pay tax? Here in Canada if you are a deemed or common-law resident, you pay tax, period, regardless of your citizenship status. I was just wondering if the US has something similar.

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Response to laundry_queen (Reply #4)

Wed Jan 16, 2013, 01:33 AM

6. Ordinary foreign residents who earn money in the US, pay US income tax

US expats living in other countries are given an exemption (around $90,000 of foreign-earned income for full-time residents of foreign countries) before they are required to pay US income tax, and the amount of US tax on income above that threshold depends on how much income tax they pay in their host countries.

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Response to Art_from_Ark (Reply #6)

Wed Jan 16, 2013, 01:39 AM

7. Thanks.

I was wondering...

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Response to Newsjock (Original post)

Wed Jan 16, 2013, 01:29 AM

5. According to the article, the new law would only affect expats with total incomes of $200,000+

So it would only affect a tiny portion of the "roughly one million Americans living in Canada".

However, from what I have seen, neither the IRS website nor the US Embassy newsletter here in Japan make any mention of this supposed change in the tax law.

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