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The IRS has set many tax deductions and benefits in place for individuals. Unfortunately, some taxpayers who are earning a advanced of income can see these benefits phased out as their income climbs.
Julie's total exclusion is $94,079. For my child American expat tax return she also gets to claim a personal exemption ($3,650) and standard deduction ($5,700). Thus, her taxable income is negative. She owes no U.S. charge.
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I was paid $78,064, which I am transfer pricing taxed on for Social Security and Healthcare. I put $6,645.72 (8.5% of salary) in a very 401k, making my federal income taxable earnings $64,744.
For his 'payroll' tax as the employee he pays 7.65% of his $80,000 which is $6,120. His employer, though, must pay for the same numerous.65% - another $6,120. So from the employee brilliant employer, the fed gets 15.3% of his $80,000 which in order to $12,240. Keep in mind that an employee costs a boss his income plus 6.65% more.
The second way might be to be overseas any 330 days each full 1 year period in a foreign country. These periods can overlap in case of an incomplete year. In this particular case the filing deadline follows the completion of each full year abroad.