Effing US tax laws

Speaking of money, it’s tax time. I’m freaking out.

I’m not very good at doing my taxes. I always do them, and I’m always honest. But I hate it. Like everything else economic, it confuses my pea brain.

It’s even more confusing being an expatriot. Actually, it just sucks being an American expatriot, because we have one really stupid tax law. The IRS calls it the “physical presence test.” If I’m in the United States more than 35 days out of any 12-month period, they think I live within the United States. They then feel justified on taxing me for the money I make outside the United States. Because clearly, if I’m in the US for 36 days, I need to pay for all that road construction, policing, and firefighting I never need during the remaining 329 days I’m not there — not to mention ridiculous wars that are preserving my freedom… in Korea.

Whatever. I know I’m still a citizen, and that I have some protections of my government. Should the shit hit the fan, I’ve got a home to go back to. But talk about ecosystems… it just seems like the marshlands are a tad bit unbalanced.

Now I learn today that one foreigner here tried to put money into his IRA and his IRA shut him down. The reason? He’s claiming overseas residency in order to be free of the stupid tax law. But if he’s not a US resident, he apparently can’t fund his US investments. What? Wait a minute… Don’t companies and brokers want our money? Isn’t that the way the system works?

Three of us were sitting there scratching our heads like we’re trying to solve the paradoxes of general relativity. If we say we’re not US residents, we spare ourselves a useless tax, but we can’t invest. If we say we’re US residents, we get taxed unnecessarily but we can invest. At least, we think so. But is it a legal thing or a brokerage policy? Is it illegal to fund one’s IRA? If we fund it, are we claiming residency? This is why Canadians laugh at us.

I guess I need an international tax lawyer.


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