Taxes Expat AFIP taxes

[Sahara]

Looking at filing taxes with Afip. US expat earning income remote from an outside country depositing into US Bank account. Anyone with similar experience that can confirm 35% of total earned income is what's due in the top tax bracket here?

 

[QuiloBa]

Looking at filing taxes with Afip. US expat earning income remote from an outside country depositing into US Bank account. Anyone with similar experience that can confirm 35% of total earned income is what's due in the top tax bracket here?

Nobody can confirm this as that's not how it works.

The following is the quick and dirty of what is legally required, but NOT what happens in reality.

If you want further, in depth details please reach out to an Argentine accountant and/or lawyer.
You'd be breaking several laws by not following these rules, something tens of thousands of Argentines
and resident foreigners are already doing to get the real value of their dollars, but it's still a crime.

(The following assumes you are a tax resident of Argentina):

- You can earn up to $28,870.59 USD/year ($5,650,236.51 ARS) as a monotributo (Category H, the max for remote work)
- If you earn more than this, you must pay ganancias, and you are not able to remain as a monotributo. You WILL need an accountant
- In both cases, you issue a Factura E from AFIP for the export of services to the client(s) you have abroad
- You have 5 days from when the money is credited to your account in the US to transfer it here to Argentina
- The first $12,000 USD is not subject to pesification; there is a bill in congress to raise this to $30K, it has not passed yet
- Any amount in excess of $12,000 USD now, or possibly 30K in the future must be pesified at the BCRA exchange rate

Like I said, nobody does this, but in doing so they are breaking several laws. If you're going to be a tax resident of Argentina and
earn more than 12K now, or possibly 30K in the future you will need an accountant, and to make the decision as to how comfortable
you are in evading taxes, which is a crime.

I make no judgement either way, the "leaders" of Argentina and their kids (Maximo's sweetheart deal with AFIP for example) evade taxes
all the time at amounts in the millions, I'm just saying what the laws are v.s. what happens in reality.

 

[MartaSou]

Nobody can confirm this as that's not how it works.

The following is the quick and dirty of what is legally required, but NOT what happens in reality.

If you want further, in depth details please reach out to an Argentine accountant and/or lawyer.
You'd be breaking several laws by not following these rules, something tens of thousands of Argentines
and resident foreigners are already doing to get the real value of their dollars, but it's still a crime.

(The following assumes you are a tax resident of Argentina):

- You can earn up to $28,870.59 USD/year ($5,650,236.51 ARS) as a monotributo (Category H, the max for remote work)
- If you earn more than this, you must pay ganancias, and you are not able to remain as a monotributo. You WILL need an accountant
- In both cases, you issue a Factura E from AFIP for the export of services to the client(s) you have abroad
- You have 5 days from when the money is credited to your account in the US to transfer it here to Argentina
- The first $12,000 USD is not subject to pesification; there is a bill in congress to raise this to $30K, it has not passed yet
- Any amount in excess of $12,000 USD now, or possibly 30K in the future must be pesified at the BCRA exchange rate

Like I said, nobody does this, but in doing so they are breaking several laws. If you're going to be a tax resident of Argentina and
earn more than 12K now, or possibly 30K in the future you will need an accountant, and to make the decision as to how comfortable
you are in evading taxes, which is a crime.

I make no judgement either way, the "leaders" of Argentina and their kids (Maximo's sweetheart deal with AFIP for example) evade taxes
all the time at amounts in the millions, I'm just saying what the laws are v.s. what happens in reality.

Thank you for this, valuable info. Wanted to ask another question:

If you're a permanent resident in Argentina, work as a freelancer for a U.S. company and receive payment in a U.S. bank account, and simply Western Union yourself a set amount monthly (sent to you via a family member abroad) what is your AFIP tax scenario?

 

[Sahara]

Thank you for this, valuable info. Wanted to ask another question:

If you're a permanent resident in Argentina, work as a freelancer for a U.S. company and receive payment in a U.S. bank account, and simply Western Union yourself a set amount monthly (sent to you via a family member abroad) what is your AFIP tax scenario?

What I understand is don't get caught. You must pesify all income as an Argentine resident at the official rate, and likely, depending on your income at that rate, pay 35% taxes, on top of still being a tax subject of the US, thus making it pointless to live here.

 

[ArielVanch]

What I understand is don't get caught. You must pesify all income as an Argentine resident at the official rate, and likely, depending on your income at that rate, pay 35% taxes, on top of still being a tax subject of the US, thus making it pointless to live here.

You wouldn't pay US income taxes on the first US$120,000 in 2023.

 

[Setse]

You wouldn't pay US income taxes on the first US$120,000 in 2023.

huh? are you mixing up the foreign earned income exclusion?

 

[CarlosVoler]

huh? are you mixing up the foreign earned income exclusion?

Isn't that what this is? He's in Argentina earning money which he is taxed on. The foreign earned income exclusion is intended to prevent that income from being double taxed. What am I missing?

 

[Setse]

Isn't that what this is? He's in Argentina earning money which he is taxed on. The foreign earned income exclusion is intended to prevent that income from being double taxed. What am I missing?

i understood axel's post to mean he works for a US company and gets paid in the US. but lives in argentina. that doesn't fall under foreign earned income, he just get paid in the US and pays taxes in the US.

if he were earning money in argentina, that would potentially fall under the FEI exclusion

 

[GatoNeko]

i understood axel's post to mean he works for a US company and gets paid in the US. but lives in argentina. that doesn't fall under foreign earned income, he just get paid in the US and pays taxes in the US.

if he were earning money in argentina, that would potentially fall under the FEI exclusion

If you are physically present in this country while actually performing your work, the IRS considers it to be a foreign earned income. It is the location where the activity is being carried out that matters.

 

[earlyretirement]

If you are physically present in this country while actually performing your work, the IRS considers it to be a foreign earned income. It is the location where the activity is being carried out that matters.

Also, remember that if you're married, you can possibly double your foreign income tax exclusion if you set everything up properly with paperwork (and/or if you can arrange it with your employer to have your spouse earning income as well). Also, make sure to stay in that location at least 330 days per year.

Foreign Earned Income Exclusion | Internal Revenue Service

You may qualify for the foreign earned income, foreign housing exclusions and the foreign housing deduction if you meet certain requirements. Learn more.

www.irs.gov

This is a fabulous benefit that I took advantage of for many years.

 

[StatusNomadicus]

@Setse i worked for a US company overseas, getting a W2, paid in Dollars, and stayed out of the USA for 11 months out of the tax year, and paid no federal or state taxes for my income for multiple tax filings, using a legitimate accountant (but could have done it on my own).

FEIE "Physical Presence Test" requires 330 days not in the USA: https://www.irs.gov/individuals/int...arned-income-exclusion-physical-presence-test