The Ecuador Insider

“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!

Ouch.

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!

“Stay at this hotel in the center of Ibarra (Ecuador),” my friend said.  We were both planning on going to an event together.

I have never faced such an issue in any of the Liverpool Hotels or Moscow Airbnb, I have stayed during my various vacation trips.

So I booked there.

And sure enough he cancelled.  But I was still going so I went and stayed at this place my friend chose.

And it was during this recent stay I realized most budget hotels in Ecuador that usually charge around $10-15 per person have many things in common.

Must be a cultural thing!

…you know you’re in a budget hotel in Ecuador when you open your window to get some air and a big a$$ fly comes in because you have no screens.

…or when you look out your window and you’re looking right in the window of another room.

…or when your sink is outside the bathroom.

…or when your bathroom sink has no mirror, let alone a shower filter there, and no hot water, or the hot water is reversed making it a damn mind puzzle just to get some hot water.

…or when you notice your room has a mini-fridge (for some reason) in the corner that doesn’t work and you need appliance repair job because you don’t have enough money for new appliance.

…or when you try to shave in the poor light and come out looking like a crack head who tried to shave while looking at their reflection in a street puddle.

…or when you get one of the interior rooms with no window at all.  No this is not prison I’m talking about.

…or when you can tell your neighbor with exactitude how many times they entered the bathroom the night before due to the SCREECHING sound the doors in the hotel make when you open or close them.

…or when you try to sleep on the rock hard mattress making you fantasize over sleeping on the floor.

…or when you realize your little ventilation window in the bathroom empties out into the hotel kitchen.

…or when you hang your clothes over the TV because there is not one little clothes hanger or place to hang anything in the entire room.

…or the suicide electric shower that doesn’t heat up the water all that much, and when asking for help they tell you how to do it by fiddling with the wet wires (making you the ground).

But hey, its all in good fun, an experience that should not be missed!

This coming Sunday February 4 Ecuadorians (and legal residents who have registered to vote) will head back to the polls for a referendum ordered by the current sitting president Lenin Moreno.

Ecuadorians will answer 7 questions aimed basically at overturning much of what the previous President Correa did in office.

The main question that will effect real estate in Ecuador is the one asking if Ecuadorians would like to overturn the new (exaggerated) capital gains (plusvalia) tax that was instituted last year.

Another highlight is the question that will re-establish term limits basically making it illegal for Correa or anyone else to sit indefinitely as a president-dictator.

Other questions seem to be no-brainers like having to do with strengthening child abuse laws and limiting mining and oil exploration in the Amazon. I mean, who is going to vote against going tougher on child abusers? Id like to see that class when the teacher asks… “ok, raise of hands please, who disagrees with going harsher on child abusers?”

I love it.

And if the capital gains tax gets abolished or bumped down to what it was before the property prices in Ecuador could jump both in the short and long term.

Market re-activated.

Democracy is once again restored in Ecuador, for a while there it was questionable if we would be the next Venezuela.

Stay tuned!

Hasta pronto, if you liked this sign up for my Ecuador Insider’s newsletter so you can check out my latest posts(not available online) on living and investing in Ecuador:

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Hasta pronto, if you liked this sign up for my Ecuador Insider’s newsletter so you can check out my latest posts(not available online) on living and investing in Ecuador:

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