Taxes

Turbo Tax Basic
File foreign earned income and up to 85k is reduced. Can file back 2 yrs or up 20 to apply deductions to other years.
If filing as clergy you can deduct housing but must fill out the self employment tax form.

June 15, 2008: Deadline to file an extension for federal return. If you reside outside the US on 4/15/2008 you have an automatic extension until June 15, 2008 to file your US federal return. If you owe any tax, interest will accrue from 4/15/08. If you need to file an extension you can visit www.officialpayments.com and file a Form 4868 and make an estimated payment.

Q1 It seemed like I owed taxes if I filed as clergy and received a refund if I filed regular. If I can have all my income taken off by the foreign earned income it seems to hurt to file as clergy. Is there any advantages to filing as clergy? I was just wondering if there were any changes I should make for next year. I don’t think you were officially considered “clergy” until January 2008, even though you received your first housing allowance in December. So you’re probably best to file “regular” for 2007. That will change for 2008 and all your social security withholding will be considered self-employment tax. It doesn’t really change anything financially for you, but it changes your tax return quite a bit. So for 2007, go with the regular status. I probably confused the issue with my earlier emails.

2 social security did not seem to change no matter how I filed. We payed 1,600 in ss. Do you know how that works? That was withheld from your pay in 2007 and sent to the Social Security Administration – which was the correct thing to do until you were officially considered clergy. For 2008, as clergy, you are exempt from social security taxes, but have to pay self-employment tax instead. Financially, it’s the same difference, but the IRS collects the self-employment tax so it’s reported on your 1040 tax return. You’ll still get credit for it in determining your social security benefits.