I am both an active Day Trader and a devoted traveler that can give you a few unconventional ideas about how to save on your taxes, travel, and work on your business at the same time. If you work from home or have an online business, any business that is mobile for that matter, then read this blog post. Having said that, how big is your imagination? Would you like to trade from Paris? Or how about the Paris of the south?
First let me tell you that I am not a CPA or certified Tax Professional, so you definitely are going to want to run these ideas by your accountant. Any time you are self employed or run your own business online you have access to a different lifestyle, in my case its day trading.
Let’s move on to the good stuff and this isn’t under the table of behind Uncle Sam’s back. the way that you can save big is called the Foreign Income Tax Exclusion. You always want to do everything legitimately with the IRS. Remember in tax court, your GUILTY UNTIL PROVEN INNOCENT.
The Foreign Income Tax Exclusion Explained:
The Foreign Income Tax Exclusion simply states that if you live outside of the United States then you can exempt up to $91,500 from your taxes. This exemption is for United States citizens only. The basic premise is the concept of your tax home. If your tax home is in a foreign country and your living overseas then you may be eligible for these huge savings. A tax home is defined as “the general area of your main place of business or employment, regardless of where you maintain your family home”.
Has a light go off yet? Anyone working overseas (day traders, corporate employees, or travel bloggers) need an office (ie: a home office in Paris or wherever your heart desires to travel). Again, speak to a tax professional to see if you are able to take advantage of any deduction including this one. The basic premise however, is that if your general place of business is outside of the United States (for more than a year), you may be eligible for a substantial savings in income taxes.