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Leaving the family behind

I searched around a little, but I did not find what I was looking for.

So I am likely to receive an offer from a contract company to work on Arifjan very soon. I also own a house in the US with a wife and a child. I am just about to retire from the military, and this is about the best opportunity I've gotten so far.

Anyways I have been to Kuwait several times, but I was always under the assumption that the contractors stayed on base. I have found out, of course, that I was incorrect in that assumption. So I have been looking around at what it would take to rent a place, transportation, food, etc.

In doing so, I have noticed that many of you bring your family with you. This is not something I am able to do at this time. So I will have to be able to transfer money from a bank in Kuwait to one of my accounts in the US in order to pay bills. I am also hoping to use the money I make in Kuwait to pay off my mortgage since my base salary will be much more than I make now.

Anyways what I am looking for is some insight from others who have done this. What would I be looking at come tax time? She works as well, and we normally file jointly. I'm supposed to receive some sort of stipend from my company to help cover living expenses and travel to and from Kuwait. (I don't know all of the particulars and exact numbers yet.) So hopefully that allows me to continue forward with my plan to pay off my house in the states.

Seriously any insight from those who have done this would be greatly appreciated.

Cocky,

I am not an US citizen so I obviously can't have first hand experience, but as far as I know Foreign Account Tax Compliance Act implies that you would be filling your tax forms the same way as you are doing it now.

This IRS page confirms that:

https://www.irs.gov/individuals/interna … ens-abroad

"If you are a U.S. citizen or resident alien, the rules for filing income, estate, and gift tax returns and paying estimated tax are generally the same whether you are in the United States or abroad. Your worldwide income is subject to U.S. income tax, regardless of where you reside."

So nothing really changes for you.

Yes but as a married citizen, you have the option to either file jointly or separately. Ordinarily it is beneficial to file jointly for various credits and what not. However would it not be better to file separately in this instance? Would owning a home in the US affect anything? Is it even feasible to maintain a residence in both countries?

Someone else will have to chime in as I am completely unfamiliar with the intricacies of US tax law. :)

Yeah so are most of us who live here lol.

cocky0 :

Yeah so are most of us who live here lol.

:lol:  :top:

Honestly, I'd find a professional locally and ask them.  It wouldn't cost much and it'd do a million dollars worth of good to you.

I would seek the advice of an accountant in the US buddy. Best to be safe when dealing with the tax man and they will be able to give you all of your options.

Thanks for the replies, folks. My CPA assures me that owning property in the states and claiming that as a residence would not affect my tax-free status, so that answers that question. All I have to figure out now is how transfers from a bank in Kuwait to a bank in the US works out. I'm pretty sure there will at least be a lag before the funds are available in my US account, but I'll have to figure out what that will be and what fees, if any, are involved.

NBK SWIFT transfer has very reasonable fees, and it took a day to do a transfer to Europe.

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