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If you are a citizen you can apply for non-residency. I believe the rule is that if you are out of the country for >= 181 days of the calendar year, you may apply to be income-tax exempt on those portions earned outside the USA.



It's the "foreign earned income exclusion", and it's only the first $91k exempted from US tax (plus a housing allowance, with some restrictions). To get it, you need a "bona fide foreign residence" or 330 days/yr out of the US. I'm actually going to spend the last few months of 2009 on vacation, using the savings in taxes to pay for it, since I'll be out 9-10 months in 2009 just for work.

The first 91k is basically 18k in taxes at current rates. They unfortunately changed it from LAST 91k (i.e. the income at your highest marginal rate, easily 33% or 35%) in 2006, at the same time as making it inflation adjusted).

http://en.wikipedia.org/wiki/Foreign_earned_income_exclusion




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