TaxesFilter: Moving abroad, not raising flags

April 13, 2008 6:04 AM

TaxFilter: Student abroad (moved in August), and don't want to get red flagged/audited due to sudden drop in income! How do I tell the IRS I moved?

I moved to Austria in Aug 2007. I was making pretty good money teaching music (self-employed) in the US, and stopped working altogether after I moved. What's the best way to make all of this clear in my tax return and do whatever I can to not raise flags? (An audit when I'm in another country would be a royal pain in the ass)

I figure being self employed is almost enough of a flag on its own without having a sudden unexplained drop in income.

posted by sirion to work & money (4 comments total)

You've had no earned income at all (no scholarships or fellowships) after moving? Are you financing your current life wholly on savings?

Anyway, if so, I wouldn't worry about it too much. There's not much you can do other than list your current occupation and residence. Any sort of extra explanation would make your return stand out.

Remember that if you live abroad, the filing deadline is 15 June, not 15 April.
posted by grouse at 6:12 AM on April 13

I wouldn't worry about it too much - you'll be putting your residence on your returns, and anyway, you're certainly not the only person to ever go back to school halfway through the year and have that be reflected in your return.
posted by lunasol at 6:18 AM on April 13

Don't sweat it. No one wants to be audited, but too many people fear an audit, and as a result don't take rightful deductions, etc. If you are not doing anything wrong, don't worry about it.

Also, on your 1040 there is a place for "occupation." You put "student" (or whatever is accurate) in there, and that tells them. Your situation is not unique enough to be a red flag. Having said that, random audits happen, and you never know.
posted by Fuzzy Skinner at 8:19 AM on April 13

If it is a deep concern, hire a tax consultant. Your peace of mind might be worth the expense. But really, you may be worried about nothing and attempting to "explain" things when none is necessarily due might be more of a red flag than a dip in income.
posted by kuppajava at 9:56 AM on April 14