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In application for the bost boring post of the week I give you (CPA tax question):

 

   


Bretom

Dec 15, 06 11:46

Post #1 of 8 (562 views)
In application for the bost boring post of the week I give you (CPA tax question): Quote | Reply

I have just moved to NY from the UK and received my first paycheque. Because its pertinent to the question I will be earning around 150k a year and a week or so ago had a very tentative go at filling in my State and Federal witholding forms. I have 6(!) taxes listed on my paycheque so far and have not started paying my medical scheme contributions or 401k yet. Coming from the UK this is bizzarre as is the amount of time and effort which seems to be required to make sure you pay the correct amount of tax let alone the optimum amount.
My question is whether at my income level and given my experience it's worth getting a professional to do my returns and give advice on ways to avoid tax or whether I will just get used to it and learn by doing - I don't have any other significant source of income or property. Would any advice I did get pay for itself etc.?
If the answer to both of those is yes can anyone recommend a source of information about CPAs in NY that I could consult with a view to hiring one?
Thanks in advance and I promise to post something more entertaining as penance for this shortly.


"Are you sure we're going fast enough?" - Emil Zatopek


"Are you sure we're going fast enough?" - Emil Zatopek

(This post was edited by luckyleese on Dec 15, 06 11:56)


efernand

Dec 15, 06 12:17

Post #2 of 8 (540 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [luckyleese] [In reply to] Quote | Reply

I would say that you should look into hiring a tax professional to help you file, at least this year. This year's return might be more complicated because of your move. Next year might be more straight forward, and once you see how it's done, it's not too tough.


IAMike

Dec 15, 06 12:31

Post #3 of 8 (530 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [luckyleese] [In reply to] Quote | Reply

Six taxes? Social security, medicare, federal withholding, New York state withholding, New York city withholding. What's the sixth?

I would say, yes get a tax pro to help you with your taxes this year (disclaimer: I am a CPA, although not in public practice). I don't know any NYC tax folks so can't really recommend anyone. If you don't get any names, drop me a note and I can do some digging to see if I can come up with someone.


Bretom

Dec 15, 06 12:37

Post #4 of 8 (527 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [IAMike] [In reply to] Quote | Reply

State Disability Insurance/Unemployment Compensation. It's only 1.30 so that's fairly far down my list of concerns at the moment!


"Are you sure we're going fast enough?" - Emil Zatopek


AmyCO

Dec 15, 06 12:42

Post #5 of 8 (521 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [luckyleese] [In reply to] Quote | Reply

Because you're new to the country, I'd have a CPA do your taxes for at least the first year. Then, if you don't have anything complicated, get Turbo Tax for the next years. I will say from personal experience that if you're in a healthy tax bracket and you handwrite your own taxes, the IRS will declare a fatwa against you and audit every single one of your returns:)


nosmo king

Dec 15, 06 12:53

Post #6 of 8 (515 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [luckyleese] [In reply to] Quote | Reply

I'd say that it depends on your personal situation. If your income is primarily wages, you have few investments other than a house, you have few deductions other than some charitable contributions, then you should be okay doing your own taxes. If, OTOH, you have lots of investments, own your own business, have kids in school, etc., you might want to hire a pro.

I was an Accounting Minor in college and did my own taxes until a few years ago. Then, when my kids started getting towards college age and we were wrestling with the Prepaid College Plan, Uniform Trust to Minors Act, Savings Bonds, and all that stuff, it got too hard and we hired a CPA.


Bretom

Dec 15, 06 13:51

Post #7 of 8 (500 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [tri_bri2] [In reply to] Quote | Reply

Thanks all this is good info. Have just been on the IRS website and am boggled by how complex this all is. I think I'm going to get a professional. I'm on J1 visa so believe I should be exempt from some stuff I've been charged for...grrr....it's a nightmare.


"Are you sure we're going fast enough?" - Emil Zatopek


drake

Dec 15, 06 19:04

Post #8 of 8 (473 views)
Re: In application for the bost boring post of the week I give you (CPA tax question): [luckyleese] [In reply to] Quote | Reply

Okay so here goes with some technical stuff:

1. I am not familiar with a J-1 visa but...if you may be able to file for a waiver in the UK to have your NIC payment in the UK made through your parent company (if there is one to the company your work for now) rather than having FICA and Medicare withheld here. You should check with your UK advisors then have it set up through them and let your payroll office here know once you have the correct paperwork if it is relevant. This assumes that there is a parent company in the U.K. and that you are not permanently settling in the U.S.

2. If you withhold 401k funds here you need to be careful when you move back to the U.K. Under U.S./U.K. tax law repatriation schemes you will be able to move the funds back to the U.K. on a tax free basis but it has to be done very, very carefully and will only be able to be handled by one of the big guys like Morgan Stanley or such. Otherwise if you move back to the UK you will have a big tax hit when you withdraw the funds.

3. The U.S. taxes WORLDWIDE income so if you have rental income or anything remaining in the U.K. you will be at risk. You really should look at hiring an advisor who understands global personal tax.

IMHO

   
 
 
 



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