Thursday, April 17, 2014

Expat Tax Season

Advertisement for a Cinema festival on a railing
Well tax season is winding down here in the US and it's times like these where you really start to question where you choose to live in the world.  I'm not a CPA, but the rule is something like if you spend more than 330 days out of the US in a 12 month period, it's good for some wicked tax breaks.  I even had an accountant apply the expat exemption over a 12 month period that took place during two different calendar years...but like I said, leave it to a professional (the professional might not get it right, but at least you'll have somebody to blame/sue if they get it wrong).

Tax laws are something I intentionally try to know as little about as possible.  The penalties are usually less if they get you for ignorance than conspiracy.  Everybody tells you that you should operate all your businesses at a loss, because actually making profit is the worst possible thing anyone can do.  With an attitude like that, no wonder the US is five hundred gazillion dollars in debt.  I guess the whole thing is just a distraction so that people don't figure out money is worthless.  As for me, I'd rather take it chill, like this guy:
Homeless person sleeping under a bridge
Actually, these days it's a lot less likely to see homeless people in Lima than it was even a decade ago.  Still, there are a couple obvious gathering points.  When I was younger these sights used to fill me with compassion, but I guess I'm getting older and more cynical.  It seems like basically everyone has an excuse to come after you if they want to--sort of like how the police can stop any vehicle on the highway and find some kind of infraction so that they can give a ticket.  Even when you make a sincere effort to do everything on the straight and narrow, all it takes is somebody with an agenda against you and they'll find something wrong.  This is why tax season is so stressful.  The guy in the above picture is probably sleeping on bundles of S/. 200 notes to hide them from the taxman.  There's basically no other way to keep it.

I always used to joke that I'd end up sleeping under a bridge to my students.  Sure, there's plenty that's miserable about such a choice, but I'd hope less people would come gunning for you.  Then again, that might be unavoidable.
I've been giving a lot of thought to returning to Lima lately.  It's obviously more difficult to travel here and there when you have a couple little children.  Still, perhaps I'm just making excuses.  Part of me thinks that my daughters would be better off in one place where they get to achieve an insider perspective and contribute to a community.  However, there's a great appeal to being a traveling outsider and gaining a larger perspective on how the world works (with no attachments).

When I lived in Lima, I always felt more free than I ever did in the US.  It's crazy how America is designed to apply pressure at every minute of the day.  Those of you who have never been to the US can probably see this pressure in the absurd comments Americans make on Facebook groups and in the comments of articles.  Americans are quick to judge, and I think it's because they're constantly being judged themselves.  You always have to be able to justify your actions...which isn't the case in Lima.

Oh, and as far as the Peruvian tax code goes, I've never felt I had an adequate grasp on that either.  People who want to get paid are issued a set of "Recibos de Horarios" and if you aren't paid more than a certain amount per any single recibo, you don't have to pay taxes on it.  At least that's how it was explained to me.

Sigh...tax stuff just always seems shady.

Anyway, to all my friends in Peru, stay chill!  To all my American friends, make sure you send in your tax stuff.  All it takes is a signature and a check...maybe not even a check.

Make sure you read my books if you haven't yet.  "Beyond Birkie Fever" is my most popular work, click on the link and check out the reviews.  Also, I'm involved with this, got something featured here, and I've been wasting a lot of time lurking around here lately.  If you want a free book to review, write me at walterrhein at gmail dot com.  Oh, and read this too.