How do we tax internationally?

October 13, 2016 8:11 PM

Last year, my partner and I did farm work in Australia on a work & holiday visa. Some employers gave us PAYG forms, which appear to be the Aussie equivalent of a W2, but not all did. We have since returned home to the US. What documentation should we provide the IRS in place of a W2 when we file?

We are both US citizens. We filed for an extension in April.

I have PAYG forms from the farm I worked at most of the time I was there, plus one other. My partner has a PAYG form from one farm, but the farm that accounts for the majority of her income didn't give her one - just pay stubs.

Will the IRS accept the PAYG forms, or copies of them? Where we don't have PAYG forms, will they accept copies of pay stubs for that employer? Which tax form or forms should we be filling out?

We both filed extensions, but it turns out my partner's income was low enough that she normally wouldn't need to file. She is concerned that requesting an extension and then not filing will look strange to the IRS. Should she file because she filed for the extension?

posted by sibilatorix to Work & Money (6 answers total)

Australian employers provide a "payment summary" within a few weeks of end of the australian tax year (30 June).

If you didn't get yours, just contact the employer and ask them to re-send a copy of the "payment summary" to you (you could also describe it as a "group certificate" which was the previous term and still often used. Requesting a copy is a really common request, often they are posted out and if you'd moved address can easily go astray.

No idea about the US tax stuff sorry, this is just knowledge from life as an australian employee (and hr person).
posted by kitten magic at 8:46 PM on October 13, 2016 [1 favorite]

I'm a US citizen living in Australia. I would take a look at this IRS page Foreign Earned Income, and guess that you need to file a 2555-EZ Foreign Earned Income Exclusion form.

PAYG/payment summary forms should be more than sufficient, especially if you didn't earn enough (over 100k!) to pay any US taxes on it.
posted by jrobin276 at 8:51 PM on October 13, 2016 [1 favorite]

Best answer: It's correct that you report foreign earned income on form 2555, but you won't qualify for the exclusion unless you can meet the "physical presence test" which requires 330 days abroad during a 12 month period which must overlap with your tax year. Your partner should still file even if no taxes will be owed. I am not a lawyer or accountant and this is not legal advice. You don't actually need to submit your PAYG summaries or pay stubs although you can. At least, when I file online I certainly don't submit my PAYG summaries. I just enter the information on them.
posted by indecision at 10:16 PM on October 13, 2016

Best answer: Add the amount of all your earned income including foreign income and put it on line 7. I've written in "FEC $XXX" for foreign employment compensation to the left of the box in line 7 to make it clear where the money that wasn't on W-2s came from. You don't need to submit further evidence of the amount unless you're asked.
posted by grouse at 6:14 AM on October 14, 2016

If you don't qualify for exclusion under form 2555 you can get a credit for some of your foreign tax paid using form 1116. Which is much more of a pain in the ass to calculate and fill out.
posted by grouse at 6:15 AM on October 14, 2016

Best answer: I agree with grouse, I have been filingy US taxes based on overseas income for well over a decade and have never provided any evidence of income. Don't sweat it too much.
posted by Literaryhero at 7:45 AM on October 14, 2016