Tuesday, March 26, 2013

Time for My Yearly Punishment

Yesterday I finally completed my 2012 tax returns. As I always owe some money I don't hurry my returns. As some of you may know, I am retired and live in Malaysia. Because I live abroad I not only have to file my federal and state taxes I also have to pay a penalty for living abroad.

I don't mind paying my taxes, but I do mind filling out the extra paperwork required, which is called FBAR, Foreign Bank Accounts Report.  Apparently the purpose of the FBAR is to catch those people who have millions of dollars in foreign bank accounts, like Mitt Romney. As anyone living anywhere in the world I need a bank account to pay for my daily living expenses and emergencies. But because I live abroad I am treated as a criminal. The US government is not only pressuring me, but it is pressuring banks in foreign countries who have American clients. It has gotten so bad in some countries that some banks have refused to open accounts for Americans, which is a real hardship for those Americans working and living abroad. I am retired and live on a fixed income and do my own taxes, as I do not have a complicated financial situation. Those very people the IRS are out to get have the money, the means, the lawyers and the greed to get around these requirements, whereas I sheepishly comply, face with threats of imprisonment. There is one other form, which is required of expats, who have foreign bank accounts totaling $200,000 and over. This is called the FATCA, Foreign Account Tax Compliance Act. Fortunately I do not have to use this form as I both permanently live abroad and my assets are way less than $200,000

To add insult to injury, as I am filling out my tax forms and the FBAR forms I keep thinking that because I also live abroad, my own benevolent government will not allow me to use any of the money I paid to medicare all during my working career. I am constantly reminded that I am a second class citizen, because I live abroad.


4 comments:

  1. I enjoy your blog, but my aging eyes find the white type on a colored background impossible to read.

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  2. This is one aspect of living overseas that thankfully I don't suffer with. This really does seem like bureaucracy gone mad.

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  3. LSC, thanks for your comment. I will try to change the colors to make the text easier to read.

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