Filing for taxes

22POSTS

4 years ago

Hi, I will be moving to Italy sometime next year. I have a dual citizenship and I will be working online and part time, teaching students in the States,聽 who will be sending the payment to my bank account in the US which I will keep open for this very purpose. When I file聽 taxes from Italy, should I use an Italian accountant or do I have to find someone familiar with the American system?聽 I am kind of in the dark as far as this particular matter.聽 Should I go by the American dead line for filing and聽 Is there something I should be aware of that I do not know?

I would appreciate anyone who could share some light into this matter for me.

Thank you very much Anna

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Confusion about property taxes - 12 Replies

SimCityAT Expert

13779POSTS

4 years ago

I am sorry I can not recommend an accountant, but I suggest you use a local Italian accountant that has knowledge of international taxes. The USA embassy in Italy will be able to suggest some to you.

annab1414 Member

22POSTS

4 years ago

@SimCityAT

Thank you so much for your reply. i appreciate that. I am Italian and my first language is Italian. therefore I know pretty well how to get around. I don't think i will聽 have any problems finding the right person, or at least I hope.

1 member reacted to this post

michellefaul Member

12POSTS

4 years ago

@annab1414

Ciao Anna,

Look at the US Embassy website and advice for citizens and you鈥檒l find recommendations for accountants who understand both systems.

annab1414 Member

22POSTS

4 years ago

@michellefaul

Ciao Michelle,

Grazie, i will do that. Ciao

Modicasa Serial expat

207POSTS

4 years ago

I think you will need an Italian and a US accountant.聽 You are working in ITaly and therefore the taxes are payable in ITaly at Italian rates.聽聽But the IRS will want your taxes so it will take a bit of juggling with the Dual Tax System.聽

James Dion New member

8POSTS

4 years ago

@annab1414

Anna, you need an Italian accountant for your Italian tax return (you need to pay taxes in both countries but you will get a tax credit for any taxes you do pay) as Italian income taxes are likely higher than US you will have to pay the difference between the two. I would advise that you find an Italian accountant who has experience with tax credits from the US. If you don鈥檛 have a complicated return you can likely file your US taxes on line by April 15 so your Italian accountant has the US return to use for your Italian return which you pay twice a year in June and November.聽 Do not take this lightly, the tax people are very understanding if you try to do the right thing but not so much if you don鈥檛. Enjoy your new life!!!

1 member reacted to this post

annab1414 Member

22POSTS

4 years ago

@James Dion

Thank you James, for explaining how the system works. I find it hard to believe that I have to pay taxes in both countries. Are you sure of it? After all I will be working on zoom聽 teaching people in the US. Also, I have read some of the replies from a couple of other people saying that I need聽 two accountants. That means聽 that聽 all my part time job income will go on taxes and accountants and聽 that is absurd.聽 I hope it is not the case.

Any way, I guess i will found out when the time comes. I definitely want to do the right thing.

Enjoy your time in Italy, as far as myself, it will still be a while before I can move.

vijaythrottle New member

4POSTS

4 years ago

@annab1414

Dear Annab..I think you can post in Facebook and you can also search the current bank rules for foreign immigrants

Thank you

1 member reacted to this post

James Dion New member

8POSTS

4 years ago

#10

@annab1414

Anna,聽 I can understand your frustration. The US is the only country in the world that taxes its citizens on worldwide income.聽 If you are an Italian citizen working in the US you only pay US taxes as you are not resident in Italy. But being a US citizen you are liable for US taxes no matter where you live and as a resident of Italy you have to pay there too. However, as I said, if you have a relatively simple income you can prepare your US return yourself online, it is not difficult, and then give that information to your Italian accountant who by the way will not charge you like a US accountant, likely only a few hundred euros if that. It will also help you if you withhold income tax from your online teaching to the US government as you receive it, that way you will not potentially incur some fines for not withholding. You will not pay your part-time income to report.聽 Just stay legal!!聽 Good luck.

baslimaneotmane44 Member

2POSTS

4 years ago

#11

Why do you think I'm from the USA?聽 And why are you talking about taxes?聽 Do you know me well?!!

James Dion New member

8POSTS

4 years ago

#12

Sorry, I was replying to annab1414.聽 I have no idea how you received the reply. Is it not addressed to @annab1414?

baslimaneotmane44 Member

2POSTS

4 years ago

#13

No problem

annab1414 Member

22POSTS

4 years ago

#14

@James Dion

Thanks again for your help, it is really very valuable. I have never done taxes on my one because I am not good with that kind of things. My income is simple when it comes to聽 the teaching job, but I need to file the rent聽 from my little place in Rome and at that point I would get lost. Hopefully I can find in Italy one accountant who can do both, file for the IRS in the US and in Italy. it would really be too expensive otherwise. I will definitely make a copy of all the informations you gave me and go from there. Thanks again for your time. It is really appreciated. I am italian and I know Italians tend to " not stay legal", but living abroad for so many years I have learned that it is not worse it. I am also a very honest person anyway! I do not like all the headaches of illegalities....

Take care and good luck to you too. Nowadays聽 we聽 all need it! ciao聽

Djameel ViP

547POSTS

4 years ago

#15

Hello annab1414,

You can also read about taxes in the Guide here : Tax in Italy.

Best of luck

Djameel

大咖福利影院 Team

1 member reacted to this post

annab1414 Member

22POSTS

3 years ago

#16

@Djameel

Thank you very much for your reply. I just saw it. I appreciate it. take care

basith syed New member

4POSTS

3 years ago

#17

Thank you so much for your msg. This is my WhatsApp number +91*** I m a job searcher. If you know anyone for hotel related person pls help me

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MonicadFW New member

7POSTS

3 years ago

#18

@annab1414 James is absolutely correct. (Worldwide) Income must be declared here in Italy. The IS will have a taxation agreement with Italy. For instance my husbands pays taxes in the U.K. and the difference (as tax are higher here) in Italy as per the taxation agreement between the UK and Italy. We have an Italian accountant and one in the U.K. Watch out because as James says the Agenzia delle Entrate won't be very understanding if you don't pay what's due and maybe not immediately but they will find out if there was any income which is liable of taxation here in Italy.聽 It's worth getting your facts straight and hopefully an Italian accountant who's up to speed with the US taxation system too. Good luck!

annab1414 Member

22POSTS

3 years ago

#19

@MonicadFW

THANK YOU SO VERY MUCH FOR THE ADVISE AND INFORMATION. I am not planning to do anything illegal, I never have. I am sure i will be able to find an Italian accountant who can do both. I guess I just have to look for one or someone here on this thread will eventually lead me to one in the Rome are. Take care

donnalcop New member

3POSTS

9 months ago

#20

@James Dion

Dear James,

First of all, I'm new to this website so I apologize if I'm sending you a message that should be handled another way.

In any case, I'm a dual U.S./Italian citizen and I'm moving permanently to Italy.聽 I will be working there as a teacher of the Italian language, some of it remotely with pupils in the U.S., some of it with Italian students.聽

I came across your comments on this topic right here:

www.expat.com/en/forum/europe/italy/987 鈥� ml#5444576

My understanding of what will be my new tax situation will be controlled by the Italy-U.S. Income Tax Treaty as follows:

TREATY ARTICLE 14

Independent Personal Services

1. Income derived by an individual who is a resident of a Contracting State (i.e., Italy) from the performance of personal services in an independent capacity shall be taxable only in that State (Italy) unless such services are performed in the other Contracting State (USA) and the individual has a fixed base regularly available to him in that other State (USA) for the purpose of performing his activities, but only so much of the income as is attributable to that fixed base may be taxed in that other State.

2. The term "personal services in an independent capacity" includes, but is not limited to, scientific, literary, artistic, educational, and teaching activities as well as independent activities of physicians, lawyers, engineers, architects, dentists, and accountants.

In other words, even though under the general rule that US citizens are liable for US taxes no matter where they live, a tax treaty between the two counties of interest trumps that general rule.

I may have to file a blank U.S. tax return in order to attach the Form 8833 in order to report a tax treaty based position...but I'm not 100% sure of even that.

Thoughts?

James Dion New member

8POSTS

9 months ago

#21

Be very careful, if your pay generates a 1099 from any source reported to the IRS then they expect taxes to be paid on the income. The tax treaty does not "trump" any requirement to pay US taxes, it just defines how you can claim a tax credit. In reality, you are double taxed to a degree, not fair but that is the way it is.