Topics covered:

Did you convert Traditional IRA, SEP, or SIMPLE IRA to a Roth IRA? (either all or partially)

These are U.S. pension plan types, not applicable if you do not have U.S. retirement plans.

If you don't know what they mean, you don't have one and can safely select NO.

We will determine whether a conversion is taxable or not.


Do you want to list various expenses that might improve your tax position?

A personal tax return can be prepared by utilizing the standard deduction or by itemizing expenses.

After the tax reform of 2018, the standard deduction was doubled, so the percentage of people who benefit from using itemized deductions has been dramatically reduced. We offer you the ability to list your expenses in the T.Q., but please note you may not need to do this as the total expenses need to be quite large to make sense. It

If you have expenses for your business, rental property, sale of property, etc., please list them inside those sections of the T.Q., not in the Deductions section.


Highest balance during the year

What this is

The highest positive balance on the account reached over the year - even if only for one day and then transferred to another account or used for purchase/reimbursement / etc. This is the FBAR requirement.

Where to find it

Monthly statements from the bank or brokerage house. Some banks provide the highest annual balance on the year-end statement.

If the account has financial instruments - such as shares or securities.

Since the value of securities fluctuates throughout the year, report the combined value at the end of the reporting year.

Please note that if the account's highest balance during the year was NEGATIVE, it does not have to be reported (i.e., this would be the case if the account is used for lending you money instead of keeping money in it).

If multiple co-owners share the account, report the highest balance (without splits). The next question will ask about how many co-owners there are.

If you can not find the actual figure - please do your best to estimate it.


Did you maintain a home in the U.S. while living abroad?

Maintaining a U.S. home refers to the U.S. residential property you maintain - regardless of whether it's rented out.

Owning a parcel of land or commercial property is not considered a home.

This is one of the factors that also determine your state filing requirements.

It can be a private house, rental apartment, or even a boat - a place where you can stay when you return to the U.S. permanently or temporarily. A hotel, friend's, or parent's house does not qualify. It has to be where you can legally stay at any time through direct ownership or lease agreement.

Lastly - if your spouse resides in the U.S.:

  • If filing a joint return, you can answer YES to this question.

Maintaining a home does not imply ownership or rent. It is just a place where the taxpayer (or spouse, if filing jointly) may stay at any time when in the U.S.

  • If you file separately, then the answer is NO.


This does not include local Social Security payments, property or wealth tax

I.e., please report here what is equivalent to the INCOME tax only (i.e., impots sur revenus in France; Einkommensteuer in Germany, Impuesto Sobre la Renta in Spain).

If you are unsure - please check with us.


Indicate the monies actually PAID during the calendar year

Very important - please indicate the monies actually PAID during the calendar year, not the amount of tax assessment (which may not be known until the following year). In some cases, It may be tax paid on the prior year's income.

For example - you paid $10,000 tax in 2014 for the income you had earned in 2013 (because your local tax office only sent you the bill in 2014). You also know that you will have to pay $30,000 income tax for the 2014 tax year but only sometime in 2015.

If you are answering T.Q. for 2014, you should answer that you paid $10,000 in income tax in 2014 because that is the actual monetary amount of tax you paid during the calendar year.IRS does not care about your complicated relationship with the local tax office - only the actual dollars and cents (or local equivalent) you paid them.

To summarize - these are the actual tax payments made during the calendar year, regardless of the year to which the taxes relate.


If all or part of your income was pension/disability

If all or part of your income was pension/disability and you are not sure how it was taxed in your local country vs regular income, please leave a comment "Lumped with tax paid on other income" in the box where we ask you to report tax paid on wages by clicking on the pencil icon. Repeat the same in the box where we ask you to report tax paid on a pension.

We will prorate the total amount of tax paid to different income types. For the foreign tax credit, taxes paid on wages and pension/disability cannot be lumped together.


If you simply earned a salary and had taxes withheld from it

Provide us with the total amount withheld during the calendar year. I.e., let's say you make $5,000 per month, and $1,000 was taken for income tax (NOT Social Security) - your total income tax paid would equal $12,000.


At any point during the calendar year, was the sum across all your non-US financial accounts over USD 10,000?

The question asks if you had a financial interest in or signature authority over a financial account (such as a bank account, securities account, or brokerage account). It also includes accounts in which you have a future financial interest, such as retirement accounts, life insurance policies, or trusts. It must be reported if it's an account with some monetary value.

The $10k threshold refers to any one point in time during the calendar year.

This $10k threshold refers to any one point in time during the calendar year, even if only for one day. When we say 'your accounts,' we mean either your accounts or accounts over which you have signatory authority. If you had 8k in one account and 4k in another (i.e., the total was more significant than $10k), you would answer Yes to this question.

Do not count loans

Please do not count any loans you might have. Any account with a negative balance is ignored for this calculation.


Has the property been occupied by you as your primary residence for at least two out of the five years before the sale?

If you pass this residency test, you may qualify for the maximum exclusion of gaining $250,000 ($500K for married filing jointly) from your income. Few exceptions are available to this test. For exceptions, schedule an appointment.

Please see this article for more information.


Did you contribute to a U.S. IRA, ROTH IRA, or SEP account during the filing year?

This question refers only to self-funded individual retirement accounts. Employer-sponsored plans (such as 401(k) and 403B) do not belong here.

IRA contributions will reduce your taxable income.

Please note - contributions mean new money added from outside of the account. Reinvestment is not considered a contribution.

ROTH IRA - we will calculate whether they are excess contributions. If so, we will advise on how to fix this.

Please note - the deadline for making contributions to ROTH IRA is your tax return filing deadline [there are no extensions]. Usually, it is April 15th.


Did you receive U.S. retirement distributions (such as Social Security, IRA, 401-K, government or military pension)?

We will determine if this is taxable or exempt, but it needs to be reported to the IRS.


Do you have an annual tax summary (i.e., local W2) from any country outside of the U.S.?

This question refers to the official document that may also be called Tax Assessment or Tax Declaration. It summarizes all your income and taxes paid for the year.

  • If your resident country's Tax Authorities do not require you to produce it and do not present you with one, the answer is NO.

  • If you don't yet have the annual Tax Assessment but expect to get it later this year - you have an automated extension through June 15th. We can now prepare the draft of your tax return based on the information available based on the tax paid during the year - even if the tax was on income earned in the prior year. When you upload the tax assessment form, we will only adjust the amount reported on your tax return if you are due a refund. Otherwise, the amount paid will remain unchanged.

  • If you are filing a joint return with your spouse in your resident country, you have to answer YES (even if you have no income).

  • If the tax declaration covers only part of the year (because your local country's tax year doesn't coincide with the U.S.) - please answer YES. We still want to see it.

  • If the resident country tax authority automatically filed a tax assessment - please answer YES to this question.

  • If you live in the U.S. but file taxes in another country - we would need to see the tax return for that country.

  • If you file taxes in multiple countries - we would need to see tax declarations for all of them where you file tax returns.

  • If you are not filing a tax return in the residence county and local Tax Authorities do not provide you with an annual tax assessment document, the answer is NO.


Are you required to pay income tax in your resident country?

Please note that the answer should only be NO if you are generally exempt from tax obligations in the resident country regardless of how much you earn (i.e., you live on a tourist visa and are not allowed to work in the country).

Answer YES in all other cases - whether you actually pay tax or not (for example, if your income level is below the minimum level at which tax is collected or even if you did not work at all).

We ask this to determine your eligibility for Bona Fide Resident status.


Account Type

Bank Account - Checking or Saving account, Certificate of Deposit with a bank.

  • Investment Account - contains stocks, bonds, options, futures, and other derivative instruments held in your name by a financial institution.

  • Business Account - bank account of a non-US business entity (corporation or partnership) in which you own more than 10% ownership interest.

  • Insurance / Annuity - foreign-issued life insurance or annuity contract with a cash value.

  • Retirement Plan - balance on the employer-provided or self-managed foreign pension plans. Plans that do not have a balance (defined benefits plans) do not need to be reported. Examples of defined benefits plans include Australian Superannuation, Survivor benefits, and most plans earned by working for the Government.

  • Grantor Trust - Foreign trust is a grantor trust if it meets one of the two conditions:

    • 1) The U.S. grant owner (aka settlor, grantor, trustor) reserves the right to revoke the trust and take over the trust assets OR

    • 2) Distributions from the foreign trust, while the trust owner is alive, go ONLY to yourself and/or to your spouse

Please note - if two account types (for example, bank account and investment account) share the same number, you can report it once and pick whichever account type you want.


Did you receive a stipend or fellowship grant?

A stipend is a form of salary, such as for an internship or apprenticeship. Some University Graduate Schools make stipend payments to help students have the time and funds to earn their academic degree.

A fellowship grant is generally an amount paid or allowed to an individual for the purpose of study or research.


Did you contribute to the local country's Social Security system during the tax year?

Please answer YES regardless of whether contributions were automatically deducted from your paycheck or you made them yourself manually. Whichever way the contributions were made - the answer should be YES.

Below is the list of what various countries call their Social Security systems. If your country is not on the list and you are not sure - ask us.

  • Australia - if you are Self-Employed and make contributions to the Superannuation Fund - please answer YES. Those contributions will exempt you from the requirement to contribute to U.S. Social Security. If you are a salaried employee - please reply NO. For you, it's just a nondeductible contribution to an employee pension.

  • France - Sécurité sociale

  • Germany - Sozialversicherungsträger

  • Japan - Social Insurance

  • Korea - National Pension

  • Netherlands - Sociale zekerheid

  • New Zealand - Superannuation Fund

  • Norway - Trygdesystemet

  • Singapore - Central Provident Fund

  • Spain - Seguridad Social

  • Sweden - Sociala trygghetssystem

  • Switzerland - Pillar 1

  • United Kingdom - National Insurance


Original Purchase Price of the Sold Home

Please provide the original price you paid for the house (not the current fair market value or a value at which you might have refinanced the mortgage).

If you paid separately for the house and the land (for example, for leasehold and then purchased freehold separately) - please add both values together (and provide details in the comment).

If you received the house as a gift or inheritance - you should report the sale the same way you would report the sale of purchase. The cost basis for the gifted/inherited property is the original cost basis (purchase price your giftee paid for the house).

In your answer to the question Original Purchase Price of the Sold Home - leave a comment by clicking the Pencil icon and writing the word "gift."

You can also include additional expenses incurred during the home purchase.

Examples of purchase expenses you can deduct upon the sale of the home. These expenses increase the house's value and reduce the profit realized upon selling the home. They include:

  • legal fees for obtaining title to the home

  • title search fees

  • title insurance

  • title recording fees

  • transfer taxes, and

  • survey fees


Did you receive any dividend income during the filing year?

Dividend - a distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders. Dividends can be issued as cash payments, like shares of stock or other property.

For more details and a video explanation, please see the Investopedia article.

Please note that if you sell a stock or Mutual Fund for profit, that's not a dividend (but relatively capital gains).


Did you receive cash or property distribution from a Trust (whether U.S. or Foreign)?

If you don't know what a trust is (or are unsure if one is giving you money), you most likely did not receive distributions from one.

In case you still want to know:

Trust - a fiduciary relationship in which one party, known as a trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary. A family trust is an example of such a fiduciary relationship. The source of trust assets can come from the inheritance or be funded by live individuals.


Country & Pension Type (Social Security, via an employer or individual pension plan)

This question applies to all kinds of pension plans - Social Security, employer, or individual pension plans.

Amount of rent received during the tax year.

If you only own a share of the rental property:

Please report the total rental income and your ownership share in the property.

Both rent and expenses will be prorated on the return (i.e., we will calculate your share).

We need this information because we must report the total rental amount charged and your share of the property to the IRS. The reason for doing so: if we only report a portion of the rental income on the return, it may look like the rental is below the market value (expenses not allowed for deduction) - which will cause problems with the IRS.


Auto & Travel Expenses

You can deduct your auto and travel expenses only when they were incurred to visit the rental property for management purposes.

Here is a more thorough outline of what "Auto & Travel" expenses are deductible in connection with your rental property:

  • First of all, to deduct the cost of your trip (plane ticket, transportation expenses, lodging, etc.), the purpose of the trip must be primarily for your rental ­activity. If your trip is primarily a vacation—that is, you spend more than half of your time on personal activities—the entire cost of the trip is a nondeductible personal expense.

  • As long as your trip is primarily for your rental activity, you would be able to deduct the cost of transportation and other necessary expenses directly connected with the rental activity (plane ticket, transportation expenses, lodging, etc.).

  • Deductible auto expenses can consist of either actual expenses (gas etc.) or using the standard mileage rate (for 2018: 54.5 cents per mile for business miles driven).

The IRS closely scrutinizes "Auto & Travel" expenses, and it is essential to properly document all these types of business (rental property) deductions.


U.S. Dividends in $

U.S. Dividends refer to all dividends paid out from a U.S. securities account.

You only have to answer this question if you received dividends from a U.S. brokerage account. If you did, you should have received a 1099-Div to report them. If not, leave this section of the questionnaire blank.

Which companies issue them (domestic or foreign companies) does not make any difference.

Please report what is shown on the form. Whether the dividends were cashed out or reinvested does not make a difference. They are taxed upon dividends distribution in either case.

Do not report interest or dividends earned in the Traditional or ROTH IRA.


Select your Refund method

We can provide your U.S. bank details on the tax return - the IRS would then be able to make a direct deposit of your refund.

If you don't have a U.S. bank, please select the other option - then the IRS will send you a check. Unfortunately, refunds can be electronically deposited only into a U.S. bank account.


Did you incur higher education expenses for yourself, your spouse, or dependents (college and beyond)

They may be used as a deduction for all US-accredited universities and some foreign universities - we will determine if it is.

Please note that professional education required by your professional license or current employment conditions does not qualify.

Also - school accommodation is not an expense qualified for deduction.

You can only claim the amount reported on form 1098T - whatever your school reported as qualified tuition cost.

If you incur work-related educational expenses, please list them under Other Expenses (at the bottom of the Deductions tab).

You can deduct your dependent's tuition as long as they are dependent on YOUR tax return, even if they file their 1040EZ form (but they should not claim a personal exemption, or you won't be able to list her as a dependent).


Currency to check

You can indicate monetary figures in your local currency. Select the currency from the dropdown or pick OTHER if your currency is not listed, and the system will ask you to type its name.

We will convert it to USD for you. Alternatively, you can convert to USD - for official F.X. rates, please see Historical F.X. Rates.


Different tax calendar

Suppose your resident country uses a different tax calendar (for example, April 1st - March 31st). In that case, you can do either of the following to reconcile income earned during two tax periods to the 12 months we ask for:

  • Ask your employer to provide a calendar year-based statement

  • Multiply your monthly salary by 12 (if it was steady through 2 years)

  • Annualize income based on the two consecutive tax declarations: take 1/4 of wages shown on the prior-year declaration (this will be your income for Jan/March) and add 3/4 of wages shown on the current year declaration (this will be your income for April/December)


Pension contributions reporting

If a part of your gross salary went to the pension contributions, then it depends on where you live for the purposes of reporting:

If you live in a country where pension contributions are allowed for deferral by Tax Treaty (UK, Germany, Belgium, Netherlands), you report gross pay after contributions.

You should report the gross amount before pension contributions for all other countries.


Do you have a mortgage on the residence in which you live?

This applies to the mortgage on any property you own but do not rent. It may be the U.S. or foreign mortgage.

If you have a mortgage on other homes (which you rent out), please provide details about them in the Passive Income > Rentals tab.

If you bought or sold the property in the middle of the year - please provide the mortgage interest paid for the duration when you were paying it.

Please note - only the person(s) listed on the mortgage can deduct mortgage interest. If you are paying off someone else's mortgage (and it's in someone else's name) - you can not deduct it.


Did the account earn ANY income (such as interest or dividends) during the tax year?

There is no minimum required to answer this question.

Any amount of income earned requires you to answer it with a YES.

Please note - even if the account may be treated as a tax-deferred investment in your country, it may not be considered as such by the IRS from their perspective. Therefore - please report the account and interest, and we will determine whether it is taxable and should be reported on FBAR.


Address of Property #1

Please report any rental property you own worldwide. Report the total value of the property and the percentage of your ownership.


Was form 5471 filed on your behalf by another U.S. officer/director of this foreign corporation?

Form 5471 may be filed only once - provided it includes information on ALL US shareholders with at least 10% ownership.

If somebody else filed form 5471 on your behalf, we would need to see its copy.


Did you receive any interest income during the filing year?

Interest income is defined as money that is paid in exchange for borrowing or using another person's or organization's money. Interest is calculated as a percentage of the money borrowed.

The most straightforward kind of interest is if you have a bank account - the bank will pay you some percent for the privilege of holding your money.

For example, if you have $1,000 in a bank account and the interest rate is 1%, the bank will give you $10 per year as interest. This is what this question is asking for.


Investment expenses

Here's a list of investment-related expenses that you may be able to deduct:

  • Fees for investment counsel and advice, including subscriptions to financial publications

  • IRA or Keogh custodial fees, if paid by cash outside the account

  • Software or online services you use to manage your investments

  • Safe-deposit box rent, if you use the box to store certificates or investment-related documents

  • Transportation to your broker's or investment adviser's office

  • Attorney, accounting, or clerical costs necessary to produce or collect taxable income

  • Charges for automatic investment services and dividend reinvestment plans

  • Costs to replace lost security certificates

Investment-related expenses that can't be deducted include:

  • Trading commissions — these are "capitalized" to increase your cost basis and/or reduce your taxable sales proceeds

  • Costs of traveling to attend a shareholder's meeting

  • Investment advisory fees related to tax-exempt income — you generally need to prorate these fees based on the portion of tax-exempt investment income versus total taxable investment income.

  • Borrowing costs associated with life insurance

For more details, please see Tax-deductible investment expenses.


Please provide details of assets sold during the filing year

When you buy a stock or other securities, the amount you pay is your cost basis. Then - when you sell the stock, the amount you receive is included in income, less your cost basis, so you only pay tax on the value gained while you hold the stock.

More formally, any investment's cost basis is the original value of an asset adjusted for stock splits, dividends, and capital distributions. It calculates the capital gain or loss on investment for tax purposes.

For more details, please see:


Did you earn any income from the U.S. during the tax year?

Please note that this refers to earned income (meaning you worked for it).

Please complete the top-level tab Passive Income for all items of other income (such as rental income or interest/dividends).


Did you receive U.S. Forms 1095-A / B / C?

This question is related to the recently passed Obamacare (ACA) law in the U.S. - which requires all U.S. residents to have health insurance.

If you (along with your wife and children) do not live in the U.S. - it doesn't apply to you, and you can ignore it.

If you have foreign insurance - please do not upload supporting documents for the foreign health insurance coverage (we don't need it).

If you live in the U.S. - you will demonstrate having health insurance by one of these forms:

  • Form 1095-A (Health Insurance Marketplace Statement)

  • Form 1095-B (Health Coverage)

  • Form 1095-C (Employer-Provided Health Insurance Offer and Coverage)

Please note:

  • The forms are issued either by your employer, individual health insurance company, or other entity that issued health insurance. The form indicates who issued it.

  • The penalty for failing health care coverage is applied to all taxpayers by default. To get an exemption, we would have to demonstrate that you live abroad (either by the Physical Presence Test or the Bona Fide Residence Test) or by giving IRS details from your Form 1095.

  • If you or members of your household live in the U.S. and you cannot provide Form 1095, the IRS will deem you or them as not having health insurance and apply the penalty. There is no way to avoid this.

For the 2014 tax year, forms 1095-b for health insurance companies are optional. For 2014 we report coverage based on the information that you provided us.

The current IRS position is: Forms 1094-B and 1095-B are not required to be filed for 2014. However, in preparation for the first required filing of these forms (that is, filing in 2016 for 2015), reporting entities may, if they wish, voluntarily file in 2015 for 2014 following the forms and these instructions.


Did you pay any U.S. tax in the calendar tax year?

Please note that regardless of whether taxes were automatically deducted from your salary or made the payment yourself - you should answer this question with a YES.

If you made estimated payments to the IRS, they should be disclosed in the question on the T.Q.


Tax preparation fees (for the previous year)

You can include both U.S. and foreign tax preparation fees - indicate which. Preparation of FBAR can also be included. You can certainly include your last year's return if we prepare it. If you had a Phone Consultation with TFX, its cost could be included.

If a deduction for tax preparation fees can be applied (we will determine this in preparing your return), then these fees can be deducted.


What was the last year for which you filed a State Tax return?

This is only needed if you filed in the last three years. I.e., If you filed your previous state tax return before 2012, you don't have to provide it.

Previous years' returns may help improve your tax position for the current year.

Please note: A state tax return is the tax form or forms used to report income and file income taxes with state tax authorities in the United States. Tax returns allow taxpayers to calculate their tax liability and remit payments or request refunds.


Did you pay Interest on Student Loans?

Please note - this can be used to reduce your taxable income.

You can only deduct interest for the student loan issued in your name (or either spouse's if you file a joint return) for which you signed a promissory note. The loan you repay for anyone else (even a spouse or child) does not qualify you for the deduction.

Note that student loan interest is deductible only if the loan is taken to pay tuition at a qualified educational institution. Eligible educational institution. An eligible educational institution is any postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education.

If you have an outstanding unpaid debt on a student loan, you can not deduct interest accumulating on the account.

Note that the IRS will apply any refund you may receive toward the outstanding debt.


Notes

From Form 1099-INT


Moving expenses

Please note - moving expenses unrelated to an actual job change are not deductible. To qualify for the deduction, moving expenses should meet the distance test: Your new principal workplace must be 50 miles farther from your old home than your old workplace.

You could deduct moving expenses unrelated to the new job only if you moved back to the United States. Otherwise, deductible moving expenses need to be related to job-related relocation. I.e., if you move without having a new job, the IRS considers you not to have a workplace at the new home, thus making you ineligible for the deduction.

You can deduct the cost of transportation of your personal belongings to the new place of work and your personal transportation costs.

The unpaid help of friends and neighbors is not deductible and should not be reported.

Please only list UBREIMBURSED expenses (i.e., if you were already reimbursed for them by your company - you can't double-count them).

In general, the IRS allows only Reasonable expenses.

You can deduct only those expenses that are reasonable for the circumstances of your move. For example, the cost of traveling from your former home to your new one should be by the shortest, most direct route available by conventional transportation. If, during your trip to your new home, you stop over or make side trips for sightseeing, the additional expenses for your stopover or side trips are not deductible as moving expenses.

For more details, please see Moving Expenses at IRS.


Sale Price (Gross)

If you are a partial owner, report the entire sale amount and your ownership percentage in the question comment (by clicking on the pencil icon).


What was the last year you filed a U.S. Federal tax return?

We need this to determine the years you must file your tax returns.

If you filed a joint U.S. return with your spouse, this counts as your own U.S. return filing (even if you had no income).

If we are completing a multi-year project for you, please indicate the last year before you file a U.S. tax return to whichever return we are completing as your first year. For example - if we are doing 2014-2016 and you last filed the return in 2015, please answer 2015.


During the filing calendar year, did you receive compensation (wages or self-employment) in the U.S. or abroad)?

Please answer Yes if:

  • You earned any kind of income during the tax year (a most likely scenario) OR

  • You received compensation for work you had performed earlier - for example, a stock or options grant that vested during this tax year.

In simple terms - did you get paid during the tax year? There is one exception - if you own your own company, please report dividends paid to yourself by your company as you report other dividends - via the Passive Income tab, indicating the source (your company name).

Please note - if you were given any kind of deferred compensation (for example, unvested shares or stock grant contingent on future performance), it does not have to be reported during the tax year of issuance.

But you will have to report it in the tax year when the restriction is removed (i.e., shares vest, etc.). Please go to the top-level tab Passive Income for all items of other income (such as a pension, rental income, capital gains, interest, or dividends).


Did you own residential real estate during the tax year?

Please note - if:

  • You are married

  • You are filing separately from your spouse

  • Your name does not show up on the deed of the property

Then you have to report ownership of the property depending on the laws of the country you reside in. Property acquired during the marriage can be considered under either community property (jointly owned) regime or separation of property (owned separately by each spouse) regime.

If community property, all assets remain jointly owned regardless of the title and must be reported.

Some countries (for example, Germany) allow the choice of property ownership regimes. This means assets acquired during the marriage can be owned either jointly or separately, and you have the option of reporting or not the property that your spouse solely owns.

Although a timeshare can be sold, it's only a transfer of the right to use the deed and is not considered a tangible asset. Therefore, the answer should be NO if you only own a timeshare.

If you rent it out for less than two weeks, that income is tax-free, but the losses are not allowed for deduction.


Medical and dental expenses/insurance premiums

These may be used to decrease your taxable income if your medical/dental expenses are unusually high.

Foreign (i.e., non-US) health expenses do qualify.

Please note that contributions to a government health insurance system (such as the NHS in the U.K.) do not qualify.


Charitable contributions to U.S. or foreign-qualified organizations (Canadian, Mexican, or Israeli)

This can be used to reduce taxable income.

Please provide the charity's name and the amount you contributed.

Please see Tax Exempt Organization Search for the complete list of qualified charities.

Charities to a church qualify if the church or temple is located in the U.S., Canada, Mexico, or Israel. If the temple is located outside those countries, the donation is not deductible in the U.S.

If a cash donation is made to the qualified charity, donations exceeding $250 must have proof - not necessarily a receipt but at least a "thank you" email from the charity. Preferably with the amount for which they say thank you.


Utilities

Please include utilities for the whole year, and we will prorate them to the number of total rental days.

You can list both utilities paid by yourself and the tenant - just list them separately (you can use the pencil icon to provide additional comments).


Did you make Estimated Tax Payments to the IRS or any U.S. State?

Please note - this question refers to the advance payments you made to the IRS for the year you are filing. It is not the salary withholding and not the foreign tax payments. Those are your payments sent voluntarily to the IRS to be applied toward your future tax obligations.

We will apply this as prepayments on your tax due.


Did you pay property taxes on the residence you live and own?

If you have other homes (which you rent out), please provide details about them in the Passive Income > Rentals Tab.

If you are paying property taxes on different levels (for example, City and Regional councils) - you can list both. I.e., any taxes appraised against the property's value ( as long as you are the owner) can be provided here.

This refers to properties both in the U.S. and abroad that you may own.

Please note - property taxes will increment the amount of other claimed deductions if you itemize deductions. If you use the standard deduction, then property tax will not affect the number of deductions.


What does this mean?

The taxpayer can either claim the fixed amount of deductions ( Standard Deductions) or each separately (Itemized Deductions). Property taxes will increment the amount of other claimed deductions if you choose to itemize.

The Standard Deductions amount depends only on the filing status (from $12,000 through $24,000 for the 2018 tax year, annually adjusted for inflation). The choice between the two methods depends on how much you can deduct using the more complex method, itemizing. More than half of taxpayers benefit from Standard deductions because they would not exceed the standard deduction amount by itemizing. Additional benefits: no need to keep records and the risk of random IRS audit is significantly lower.

Itemized deductions are worthwhile if the taxpayer paid U.S. state income tax or mortgage interest on the personal (not rented) property. Then miscellaneous other deductions, such as charitable contributions, medical expenses, and gambling losses - are added to the significant deductions, resulting in a higher amount than standard deductions.

All expenses related to income production from rental property or business activity cannot be claimed as a part of personal itemized deductions. Those deductions are declared in the respective rental or business schedules. Please note that various personal expenses deductible in your resident country (i.e., commuting expenses, burial expenses, home repair, fees, and licenses) are not allowed to be claimed as a part of itemized deductions.

We assess the potential benefit you may derive using one method and suggest a deduction type optimal for your situation.


U.S. Interest Income

Please indicate interest earned from United States accounts (such as bank savings, etc.).

Only include accounts in which you have a financial interest.

According to IRS regulations, no minimum amount must be reported.


Did you rent out a property during the filing year?

Please note that this question refers to rental properties anywhere in the world where you might derive income.


If you pay property tax on joint property - who will deduct tax?

Property tax is a tax assessed on real estate. The tax is usually based on the value of the property (including the land) you own and is often set by local or municipal governments.


Cost of Land included in Purchase Price

If you don't know the breakdown between the cost of the house and the land, please select Do Not Know.

We ask this because the basis for the house depreciation deduction does not include the cost of land.


Please list any other item(s) of income or expense that you feel might affect your U.S. taxes or anything else you think might affect your U.S. income taxes

We will determine if these are deductible or not


Do you have an HSA account?

A Health Savings Account (HSA) - is a tax-exempt account set up with an IRS-qualified HSA trustee to pay or reimburse certain medical expenses you incur.


What is your ownership percentage in the rental property?

If owned by husband and wife filing jointly, then report 100%.

Otherwise, please indicate the percentage ownership of the person filing the tax return.

We need this information because we must report the total rental amount charged and your share of the property to the IRS. The reason for doing so: if we only report a portion of the rental income on the return, it may look like the rental is below the market value (expenses not allowed for deduction) - which will cause problems with the IRS.


Improvements to Home Sold

Include the total amount for ALL improvements made since the home purchase.


Did you pay personal income tax on your self-employment income during the filing year (separate from Social Security)?

Please note that every type of tax - including a tax on self-employment income - is reported on a "cash basis."

This means that you report tax paid on this type of income from January 1st through December 31st - whether this is tax paid on prior year income or current year income.


Did anyone live in your U.S. residence during the filing year?

You may be required to report the rental income.


Please list their names

The IRS requires this.

It is enough to include one family member living with you abroad. The IRS wants to know if you have family ties while living abroad. It may be close or distant family.


Do you plan to include any self-prepared forms with your return?

By self-prepared forms, we mean any forms you intend to prepare and file on your own without our involvement.

While we do not recommend this, we allow for it - but we will ask that you sign a waiver absolving us of responsibility in case you do it wrong.

If you don't plan to file any forms that you will prepare yourself (without our involvement), please answer NO to this question.


Did you receive royalties, unemployment payments, or other miscellaneous income from a U.S. source?

This is all reportable, taxable income.


Purchase price

This question asks about the original purchase price of the property.

The purchase price is the price of the house net of taxes, fees, and other closing costs.

If you paid separately for leasehold and freehold, please indicate the freehold cost in the following question (the price of land).

For inherited property, provide Fair Market Value at the time of inheritance receipt instead of the Purchase price.

If you have refinanced it later, that value makes no difference and should not be reported.

Please report any rental property you own worldwide. Report the total value of the property and the percentage of your ownership.

Even though Schedule E does not request purchase price, but Depreciation schedule does. To calculate depreciation deduction, we need to know the purchase price.


Do you have a canceled debt that you did not pay back?

If you have canceled debt - you received IRS form 1099-C or 1099-A. I.e., if you were not provided with this form, you don't have to worry about it.


Was the account opened during the tax year?

Please answer YES if the account was opened during the tax year you are filing.


Royalties Received

This is the section where you can report royalties from oil, gas, or mineral properties that you received from the property.


Was the account closed during the tax year?

Please answer YES if the account was closed during your reported tax year.

Please note - you have to report the account if it was opened at any point during the year, regardless of how long.


Did you carry out sales of securities with a U.S. financial institution?

An example of such a transaction would be the sale of stocks or bonds. You do not have to list the purchases you made.

Please note that if you had a bond that matured during the year, you do not have to report the event (bond redemption), provided that you reported the interest earned annually.

In this question, you should not describe the transactions you made with a pension plan (such as 401K or IRA).

This information is reported to the IRS by your broker. Your tax return needs to match the data they submit.


Expenses of Sale

You can report all fees listed on the closing agreement (such as realtor fees, etc.).


Did you deduct expenses for the business of your home?

If you rented an office for yourself, please report it as an Office Expense. DO NOT answer Yes to this question. It only refers to the use of the home office.


Taxes Paid (do not include any tax paid by the tenant)

Please report taxes paid for the entire year. We ask how many days the unit was rented in a separate question and will prorate the expenses for you.

Property taxes are imposed on the property based on the property value. Tax on rental proceeds is based on your income. Respectively, those two types will be reported separately.

Please list every type of tax levied because of this property and indicate the type. Separate property taxes from income tax imposed on you based on rental income. If you need more space than available, please provide details by clicking on the Pencil Icon.


Repairs

This includes regular maintenance and between-tenancy large repairs (e.g., new bathroom fittings/carpets/extractors/repaint).

There is no monetary threshold for itemizing repairs. Use your judgment and clarify significant expenses. Keep receipts for all repairs - big and small.


Did you pay a Wealth Tax (i.e., tax on assets, not income)?

Some countries, such as France, tax your assets.

For example - below are the French rates of taxation applicable for 2013. So if you had $5mio in the bank, you would have paid $62,500 tax on that amount as the wealth tax.

Fraction Taxable

Rate of Tax

€0 - €800,000

0%

€800,000 - €1,300,000

0.50%

€1,300,000 - €2,570,000

0.70%

€2,570,000 - €5,000,000

1%

€5,000,000 - €10,000,000

1.25%

€10,000,000+

1.50%


Date when rental started

Please note - this is the date when the united is listed for rent (and not the date when tenants actually moved in).

Provide the actual date, even before the tax year you are filing.

Property is considered placed in a rental activity when it is ready and available for rent, even if you do not have tenants in it yet.


Supplies

Supplies and materials necessary to conduct rental activity refer to office supplies used to keep records (i.e., paper, ink toner) and building supplies for repair (i.e., paint, brushes, tiles, etc.) - if not included in the cost of repair reported separately.


Number of days rented (365 if full year)

This is the number of days the property was available for rent. Do not count the days it was used by you personally.

For example, if you used the property for ten days of the year, the answer should be 355.


Number of Personal Use Days (if you used the property yourself)

"Personal use days" are the days when you resided in the property while it was not rented (before, after, or between the period when tenants occupied it).


Date of Sale (Date of Completion in the U.K.)

The date of sale should be the same as that which is legally considered in the resident country.


Did you donate a vehicle, boat, or airplane with a claimed value over $500

This can be used to reduce your taxable income

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