“F–k me,” I thought as I saw the envelope as the delivery man gave it to me here in Quito, Ecuador.
In big letters on the front I read “I.R.S.”
Opening it didn’t offer any consolation as I read that just for the year 2015 they said I owed them $44,000!
How did they find me? I don’t know.
What did I do next? Hired a CPA Stateside of course. I was in over my head. I had to refile my taxes for that year as the IRS pointed out what they thought were numerous mistakes and really I owed them a whole lot more than I said I did.
Now that I’ve talked to a person that’s a CPA in Troy MI, my taxes are refiled and my taxes paid, here is what I learned from the experience…
1. Don’t let just “someone you know” file for you as an expat living abroad. In my case it was my mom, smart woman but not a tax pro. Hire a professional CPA. I’ve found they charge around $325 to file your taxes for you annually.
2. Not just banks, but online banks like PayPal send all your info on every last cent you make no matter where you are in the world to the IRS, so make sure the 1099 they send on you matches your return.
3. Open an LLC Stateside and run your (online) bank accounts where your income flows through the EIN tax ID number of it instead of your Social Security number. This can save you on Self-employed taxes. The hows and particulars I DONT KNOW, so please consult a tax professional, which I am not.
4. The IRS can find you!